Alaa Hamid, who was running on Allawi's slate of candidates for the 275-member National Assembly, was shot dead on Monday in the southern port city of Basra in front of his family.
A second candidate, Riad Radi, was also shot dead. Radi was planning to run in a local race for Basra's provincial council on a list supported by Allawi's party.
Masked armed men fired on his car on Sunday as he was driving home.
Various Islamist groups opposed to holding elections while US troops remain in the country have warned candidates not to run.
With less than two weeks to the vote, many candidates have not even announced they are running for fear of being attacked.
In Baghdad on Monday, masked men shot dead another candidate, Shakir Jabbar Sahla, a Shia Muslim running in the National Assembly election for the Constitutional Monarchy Movement. The party is headed by Sharif Ali bin Hussein, a cousin of Iraq's last king.
On Sunday, anti-interim government fighters fired four mortar rounds at schools slated to serve as polling centres in Basra.
US toll increase
Meanwhile, a roadside bomb has killed a US soldier in Baghdad on Tuesday, a US military said.
The attack raised to at least 1370 the number of US troops killed since the war that toppled Iraqi leader Saddam Hussein started in 2003.
Roadside bombs, which the military calls improvised explosive devices, are a leading killer of US soldiers in Iraq.