A private US security firm operating in Iraq has been ejected from the country following a gunfight which left eight civilians dead.

Blackwater USA was accompanying a convoy carrying US state department officials through the neighbourhood of Mansour in Baghdad, when it came under attack, the UK’s BBC reports.

The Blackwater security guards returned fire, killing eight and wounding thirteen others.

Iraqi officials say most of the dead and wounded were bystanders.

The Iraqi interior ministry says the company has been banned from operating in Iraq and all personnel, except those involved in Sunday’s incident, have been told to leave Iraq immediately.

A spokesman for the US embassy in Baghdad says the incident is being investigated by department of state diplomatic security service law enforcement officials.

Blackwater has not commented.

By staff writer