The two vehicles blew up on Thursday at 7.30am (0430 GMT), with the first vehicle apparently serving as a decoy for the second.
"There was a Kia vehicle that tried to enter the checkpoint and at this moment blew up. It was not that effective but made a large amount of smoke so we couldn't see anything," said police officer Muhammad Jaafar, who witnessed the blast.
"Two minutes later, a Jeep Cherokee reached the checkpoint, opened fire with an MG machinegun and police responded with PKC fire on the vehicle, but it was too late because he reached the checkpoint and blew up."
An Interior Ministry official confirmed the account. He said the toll had risen to five police killed and five wounded. Police had originally said the attack killed two and wounded five.
Shortly before the attack, fighters fired a rocket-propelled grenade at an Iraqi army checkpoint near the ministry, causing a fire, a senior Interior Ministry official said.
Police cars and ambulances rushed the wounded to al-Kindi hospital in eastern Baghdad.
"The party which committed this attack was known to us. We arrested some of them yesterday and two days before. We were prepared"
Interior Ministry official
Police officers carried wounded colleagues into the emergency room.
Men headed into the hospital morgue to view the dead and walked out crying.
A second senior Interior Ministry official said police had been on alert for such an attack.
"The party which committed this attack was known to us. We arrested some of them yesterday and two days before. We were prepared," he said.
It was the second bloody morning in Baghdad after a car bomb targeted Iraqi security forces Wednesday, killing 10 soldiers.