Police said the victim was an Iraqi security guard, and that the attacker also was killed. Iraqi Governing Council member Mouwafak al-Rabii was in the hotel at the time and had a slight hand injury, he told Al-Jazeera satellite television.

It was the second big car bombing in the capital in the past four days. A suicide bomber hit a police station in Sadr City, the northeast Shiite Muslim slum, on Thursday, killing at least 10 people, including the bomber.

At al-Kindi Hospital, Dr. Ahmed Mustafa said his facility was treating 32 wounded and that four were in critical condition.

L. Paul Bremer, the U.S. civilian administrator for Iraq, quickly issued a statement of condolences to the victims.

"The terrorists know that the Iraqi people and the coalition are succeeding in the reconstruction of Iraq. They do not share the vision of hope for this new Iraq. They will do anything, including taking the lives of innocent Iraqis, to draw attention away from the extraordinary progress made since liberation.

"The terrorists will not succeed. Neither the coalition nor the Iraqi people will be intimidated from our path to a democratic Iraq. We will work with the Iraqi police to find those responsible and bring them to justice," Bremer said.

Saad Hamid, 41, a shopkeeper about a block from the scene, said police caught a car bomber at the same spot six weeks ago before he could detonate his explosive. Authorities then erected a blast wall at the end of the street.

The force of Sunday's blast blew over at least two sections of the thick concrete barrier, and hurled bricks to the third floor of nearby buildings.

One witness, Sevan Armin, 33, said the car approached the Baghdad Hotel on the wrong side of the street. "It was traveling at high speed. The guards at the gate fired on it. The car hit the concrete blast barrier and exploded." Armin had a slight head injury.

Another witness, Sabah Ghulam, 37, was in a car right behind the one that exploded.

"The car in front of us, a 1990 Toyota Corolla, suddenly turned into the hotel ... A policeman shot at him four times, and then there was the explosion." He said the windows in his car were shattered.

Windows were blown out of buildings as far as two blocks from the explosion. The suicide bomber's car had reached within 70 yards of the hotel, the apparent target.

U.S. troops swiftly surrounded the blast scene. Ambulance sirens wailed, and U.S. helicopters circled overhead.

The blast rattled windows in the Palestine Hotel, home to many members of the international press corps covering the aftermath of the U.S.-led war in Iraq.

On Sept. 25, a bomb was placed at the side of a hotel where NBC television had its living quarters, killing a security guard and slightly injuring one NBC soundman.

Last month, a suicide car bomber struck a police checkpoint outside U.N. headquarters in Baghdad, killing an Iraqi policeman who stopped him and wounding 19 people. The driver was trying to enter the U.N. compound at the Canal Hotel, where a truck bomb Aug. 19 killed 23 people, including the top U.N. envoy to Iraq, Sergio Vieira de Mello.

On Aug, 29 a car bomb exploded in the holy city of Najaf, killing Shiite Muslim leader Ayatollah Mohammed Baqir al-Hakim and more than 80 others. It was the single deadliest attack under the U.S.-led occupation. On Aug. 7, a bomb attack on the Jordanian Embassy killed 19.