"We confirm that a Turkish national has been assassinated," a Turkish embassy official in Baghdad said on Monday.
The victim's employer, a catering company called Bilintur, confirmed one of its staff members, Murat Yuce, had been killed.
A number of Turkish nationals have been held in Iraq, but it is the first time one has been killed by his captors.
Several others have been released unharmed after appeals by the Turkish government.
Another two Turks, both of them truck drivers, are still being held by a group which has threatened to have them killed.
In the video posted on the website, a hostage who identifies himself as Murat Yuce is seen blindfolded and being shot in the head.
In an earlier video, Yuce was shown reading a statement in Turkish urging Turkish firms to pull out of Iraq.
"In today's conditions there is no security for drivers in Iraq. Until security can be guaranteed we have stopped transporting goods for US forces"
head of Turkey's International Transporters' Association (UND)
A statement that was read out warned the Turkish driver would be killed because of Ankara's failure to heed calls to stop "aiding the occupier" in Iraq.
The three men stood in front of a banner which appeared to carry the name of the Tawhid wa al-Jihad group.
The company for which the captive worked at first refused to accept the website depicted its driver's killing.
In an interview with Aljazeera, Omar Artork, director of Kahraman Company in Mersin city, Turkey, said the pictures of the killing of a Turkish captive shown on a website were not of their driver.
"The person killed is a Turkish hostage, but he is not our driver who was taken hostage in Iraq. We could not identify him," Artork said.
Turkey's International Transporters' Association (UND) said on Monday it would stop ferrying goods to US forces in Iraq after a wave of captures of Turkish drivers.
"In today's conditions there is no security for drivers in Iraq. Until security can be guaranteed, we have stopped transporting goods for US forces," Cahit Soysal, head of the UND's executive board, said.