U.S. Ambassador Mathew Tueller said the reduction would not affect the mission's work, adding that he will continue to carry out his duties from the embassy for the “foreseeable future.”
It was not immediately clear how many personnel were to be withdrawn, nor did Tueller give any reasons.
The government later retreated from such threats, but Iraqi Prime Minister Mustafa al-Kadhimi still faces pressure from Iran-aligned groups to eject U.S. forces.
The U.S. official, who was not authorized to give press statements and spoke on condition of anonymity, also cited concerns about possible Iranian retaliation for the killing of Iranian nuclear scientist Mohsen Fakhrizadeh in Tehran last week.
Iran has accused U.S. ally Israel of being behind the assassination. Israel, long suspected of killing Iranian nuclear scientists over the last decade, has repeatedly declined to comment on the attack.
The partial withdrawal from the embassy is taking place amid a drawdown of American troops from Iraq and Afghanistan announced by the outgoing Trump administration last month. In Iraq, the U.S. plans to reduce the number of troops from 3,000 to 2,500 by mid-January, before Trump is to leave office.
An Iraqi government official said the Iraqi government was notified of a partial withdrawal of some staff from the U.S. Embassy as a “precautionary and security step.” The official said that part of the withdrawals were partly due to staff finishing their rotations and others going on leave. The official spoke on condition of anonymity in line with regulations.
In September, the Trump administration warned Iraq that it will close its embassy in Baghdad if the government fails to take decisive action to end rocket and other attacks by Iranian-backed militias on American and allied interests in the country.
Associated Press writer Mathew Lee in Washington contributed reporting.