This report discusses the situation immediately following the completion of the U.S. withdrawal from Iraq on December 18, 2011, when relations among major political factions worsened substantially, threatening Iraq's stability and the legacy of the U.S. intervention in Iraq. It includes an overview of historical and current political, military, and governance issues as well as an analysis of Iraq in relation to the other nations in the region.

The Kurdish-inhabited region of northern Iraq is relatively peaceful and prospering economically, but the Iraqi Kurds' political autonomy and political strength in post- Saddam Iraq is causing friction with Arab leaders in Iraq, Turkey, and Iran. However, an overall reduction in violence in Iraq, coupled with continued U.S. political influence over the Kurds, is likely to prevent a destabilizing escalation of the Iraqi Kurd-Arab disputes. Also see CRS Report RL31339, Iraq: Post-Saddam Governance and Security, by Kenneth Katzman.