"The peshmerga will pull out within 10 days from the Qara Tapa district following an agreement with the Iraqi government," Jaafar al-Sheikh Mustafa, minister for peshmerga affairs in the Kurdish autonomous government, told AFP.

Around 4,000 Kurdish troops also known as peshmerga have been deployed in the Qara Tapa district in northern Diyala, which also comprises the towns of Saadiya and Jalawla.

The troops made up of former Kurdish rebels have never been integrated into the Iraqi army and continue to operate under the command of the autonomous regional government that holds sway in Iraq's three far northern provinces.

On Wednesday the commander of the brigade, General Nazel Kirkuki, told AFP that the troops would be only withdrawn when ordered to do so by the president of the Kurdish autonomous region in northern Iraq, Massud Barzani.

The deployment in northern districts of Diyala province is a sensitive one as they are Kurdish-inhabited and Kurdish leaders have long sought to incorporate them in the autonomous region which they directly abut.

Commanders have long regarded Diyala as Iraq's most dangerous province.

Its volatile ethnic mix of Sunni Arabs, Shiite Arabs and Shiite Kurds has proved fertile ground for insurgents loyal to Al-Qaeda who have made it one of their main strongholds.

Since July 29, mainstream Iraqi security forces have been engaged in a major offensive against Al-Qaeda in the province involving 50,000 soldiers and police.

Diyala province is just one of a number of areas where longstanding Kurdish claims have drawn opposition from their non-Kurdish neighbours.

Mustafa said that an official Kurdish delegation met with Iraqi Prime Minister Nuri al-Maliki on Thursday and that "during the meeting the two sides agreed on the withdrawal of the peshmerga from the district of Qara Tapa."