The former premier of Iraq is to hold talks to form a government after his bloc edged out Prime Minister Nuri al-Maliki's coalition in official election results.
Iyad Allawi's secular Iraqiya bloc won two seats more than the State of Law Alliance in the Council of Representatives, but failed to gain an overall majority.
Mr Allawi has pledged to work with all sides to form a government, but Mr Maliki, who leads the State of Law Alliance, is refusing to accept the results, saying they remain preliminary.
Mr Maliki is calling for a recount, and the BBC says his bloc plans to press ahead with plans to form the new government.
In a joint statement, the US ambassador to Baghdad and the top American military commander in Iraq gave their blessing to the outcome of the election.
They say they support the findings of international and independent Iraqi observers, who have found no evidence of widespread or serious fraud.
Just hours before the results were announced, two bomb attacks in the central town of Khales killed 22 people and left 73 others wounded in the town of Khalis, in Diyala province.
The election results come about five months before the United States is due to withdraw all of its combat troops from Iraq.
