Protesters vowed to do everything to force the council's resignation, reported our correspondent in the city about 300 km southeast of Baghdad.
Islamist parties in the city had urged citizens to demonstrate against the council, saying they group represented US interests and not Iraqi.
The US occupying administration has appointed local councils in some Iraqi cities since ousting former Iraqi President Saddam Hussein on 9 April.
Some Iraqis believe these councils do not represent the interests of local citizens. It took the 25-member Iraqi Governing Council in Baghdad two weeks to decide to have a rotating presidency among nine members.