Defence Minister Nikolai Svinarov played down the significance of the decision to withdraw, saying the Balkan country would try to find other ways to take part in the US-led military operations.
"We are clearly stating that we are not pulling out of the coalition of the willing, but will continue to watch the situation and find a way to participate," Svinarov told the chamber ahead of the vote.
Out of 208 deputies present, 110 voted to reduce Bulgaria's light infantry battalion by 50 men by the end of June and withdraw the unit when a United Nations Security Council mandate expires on Dec. 31.
Fifty-three voted against the motion and the others abstained.
Parliament has final say over Bulgarian troop deployments.
Trailing in opinion polls ahead of summer general elections, ex-king Simeon Saxe-Coburg's government is under heavy pressure to bring the soldiers home from the deeply unpopular war.
Bulgaria, which joined Nato last year, has lost nine soldiers in Iraq, eight in combat, and five civilians.
About 75 percent of the Balkan state's population disagree with Bulgaria's military presence in the Arab state.
In a related development, Japanese media sources have quoted a leaked report that Japan is preparing to withdraw its Self-Defence Forces from Iraq before the end of the year.
Japan is said to plan a pullout from
Iraq by the end of the year
Foreign Ministry officials would neither confirm nor deny the reports of the withdrawal on Thursday, while no one at the US Embassy was available to comment. Thursday was a national holiday in Japan.
Quoting sources within the government, Kyodo News said the Japanese parliament, governments in the Middle East and its military allies will be informed of the decision in September and that the troops will complete the withdrawal by December 14.
That date will mark two years since the Diet approved a controversial law to put troops on the ground to provide aid to Iraq, as well as coinciding with the scheduled handover to an elected government in Baghdad.
After the departure of the Japanese military, support for the country will take the form of development assistance, the sources said.
There are about 600 SDF personnel stationed in Samawah, southern Iraq, engaged in rebuilding schools, hospitals and other infrastructure, as well as providing medical treatment and water supplies.
Julian Ryall in Tokyo contributed to this story