Iraqis kept up anti-government protests in Baghdad and the south on Saturday, dissatisfied with the premier's vow to quit and insisting on the overhaul of a system they say is corrupt and under the sway of foreign powers.

Protesters have hit the streets since early October in the largest grassroots movement Iraq has seen in decades, sparked by fury at poor public services, lack of jobs and widespread government graft.

Security forces and armed groups responded with violence to the decentralised demonstrations, killing more than 420 people and wounding 15,000, according to an AFP tally compiled from medics and an Iraqi rights commission.

The toll spiked dramatically this week, when a crackdown by security forces left dozens dead in Baghdad, the Shiite shrine city of Najaf and the southern hotspot of Nasiriyah - the birthplace of Prime Minister Adel Abdel Mahdi.

Facing pressure from the street and the country's top Shiite cleric Grand Ayatollah Ali Sistani, Abdel Mahdi announced on Friday that he would submit his resignation to parliament, due to meet Sunday.

But demonstrations have not subsided, with crowds in the capital and across the Shiite-majority south sticking to their weeks-long demands for complete regime change.

"We'll keep up this movement," said one protester in the southern city of Diwaniyah, where thousands turned out early on Saturday.

"Abdel Mahdi's resignation is only the first step, and now all corrupt figures must be removed and judged."

Teenaged protesters threw rocks at security forces in Baghdad, who were positioned behind concrete barriers to protect government buildings.

The forces fired rubber bullets and tear gas canisters at the demonstrators, wounding 10, a medical source told AFP.

"We won't leave our barricades until the regime falls, until we get jobs, water, electricity," one protester said.

More than two dozen protesters were wounded in Nasiriyah when security forces fired live ammunition at anti-government rallies, medics said.

The units dispersed a sit-in on one bridge in the city but protesters held two more, according to AFP's correspondent.

Iraq's second holy city Karbala was rocked by overnight clashes between young protesters and security forces exchanging fire bombs.

Najaf was relatively calm on Saturday, according to AFP's correspondent, but protests there usually swell later in the day.

This week's surge in violence started when protesters stormed and burned the Iranian consulate in Najaf late Wednesday, accusing Iraq's neighbour of propping up the Baghdad government.

Tehran demanded Iraq take decisive action against the protesters and hours later Abdel Mahdi ordered military chiefs to "impose security and restore order".

Over two days, 42 people were shot dead in Nasiriyah, 22 in Najaf and three in Baghdad.

The rising death toll sparked a dramatic intervention from Sistani, the 89-year-old spiritual leader of many of Iraq's Shiites.

In his Friday sermon, Sistani urged parliament to stop supporting the government, and hours later, Abdel Mahdi announced he would submit his resignation.

Iraq's Supreme Judicial Council on Saturday said it had formed a committee to probe the unrest, pledging to "punish those who attacked protesters".

Accountability for those killed has become a key demand of protesters in Iraq, where tribal traditions - including revenge for murder - remain widespread.

"Every victim has a mother, a father, a tribe who won't stay quiet," said a Baghdad protester.

"Otherwise there could be civil war."

Even cities that have been relatively peaceful, including Hilla, held mourning marches for those killed in recent days.

Within minutes of Abdel Mahdi's Friday announcement, leading factions called for a no-confidence vote - including key government backer the Saeroon parliamentary bloc, led by firebrand cleric Moqtada Sadr.

Abdel Mahdi's other main backer, the Fatah bloc, called for "necessary changes in the interests of Iraq" in a departure from its usual statements supporting him.

Since promising to submit his resignation, Abdel Mahdi has continued to hold meetings, including with cabinet and the United Nation's top representative on Saturday.

Iraq's constitution does not include a provision for the resignation of a premier, so submitting a letter to parliament would trigger a motion of no-confidence.

If parliament meets on Sunday and passes such a motion, the cabinet would stay on in a caretaker role until the president names a new premier.

Chief justice Faeq Zeidan is one of several names being circulated as a possible replacement.