In a statement Aljazeera expressed regret for the unjustified move, and said it was contrary to pledges made by the interim Iraqi government to start a new era of free speech and openness.
Aljazeera said it held the Iraqi authorities responsible for the safety of Aljazeera staff in Baghdad and elsewhere in Iraq.
The station's Baghdad staff said the decision to close the office had been expected for some time.
They said they had been facing difficulties covering the news from Baghdad and that Iraqi officials had been reacting negatively to requests submitted by the channel.
Iraqi police officers arrived in the early evening at the Baghdad office to implement the closure decision. The station's lawyers said police officers did not carry an order from a court as the country's law requires in such a case.
Instead, the police had an order from the interior ministry addressed "to whom it may concern", ordering the closure.
Lawyers said they were given a document stating Aljazeera had to promise to change its policy regarding its Iraq coverage if it wanted the office to be re-opened after the one-month punishment.
The lawyers refused to sign the document.
An Aljazeera reporter being
escorted out of the office
While Iraqi Interior Minister Falah al-Naqib announced the closure at a Baghdad news conference, Prime Minister Iyad Allawi said: "We asked an independent committee to monitor Aljazeera for the last four weeks... to see what kind of violence they are advocating, inciting hatred and problems and racial tensions.
"This is a decision taken by the national security committee to protect the people of Iraq, in the interests of the Iraqi people," he said.
The development followed reports that US Defence Secretary Donald Rumsfeld had accused Aljazeera and the other main Arab news channel, Al-Arabiya, of harming the image of the US in the Arab world.
Rumsfeld made the remarks at the Chicago Council on Foreign Relations, Aljazeera said.
"It is a disappointing move. Aljazeera is the sincerest channel, although it does not report the whole truth"
Muhammad Bashar al-Faidhi, AMS's spokesman
Earlier this month, Iraqi Foreign Minister Hushiar Zibari criticised Aljazeera, the Saudi-funded Al-Arabiya and other Arab and Iranian stations for their coverage of Iraq, and threatened to close their Baghdad offices.
Zibari said Aljazeera, Al-Arabiya, the Lebanese Hizb Allah's Al-Manar television and Iran's Al-Alam were "channels of incitement working against the interests, security and stability of the Iraqi people".
He added: "We will no longer tolerate this in the future."
Aljazeera has frequently been accused by US and Iraqi authorities of inciting violence by screening "exclusive" videotapes from Iraqi resistance and alleged al-Qaida-linked groups.
Muhammad Bashar al-Faidhi, a spokesman for the Association of Muslim Scholars (AMS), has criticised the closure saying Iraqis are disappointed to learn they are not experiencing freedom of speech yet.
"It is a disappointing move. Aljazeera is the sincerest channel, although it does not report the whole truth.
"There are a lot of tragedies that have gone unreported. We used to wonder why Aljazeera had not been reporting those facts, and we were annoyed at it, but when we learned about the American pressure on this channel, we understood," said al-Faidhi.
Saaid al-Burini, a candidate for the US Congress, said the US did not want an Arab source of news.
"The US is not happy with the idea that an Arab media organisation is on the ground and reporting independently," he said.