Abbas Farhan, another candidate from the National Movement of Reform and Development, was shot near the town of Mandili in Diyala Province, north of Baghdad.
Two other candidates were killed in recent weeks but Iraqi and US authorities say that violence has not increased in the run up to the polls.
The elections are the first in Iraq since 2005 and will establish the political landscape as Barack Obama, the US president, aims to hasten the withdrawal of 140,000 US troops from the country.
Security surrounding the elections - to be held in 14 of Iraq's 18 provinces - will be watched as a test of Iraqi forces' ability to ensure stability.
The polls are also seen as an indicator of the country's progress from sectarian violence which engulfed the nation after the 2003 US-led invasion and deepened following the 2005 elections.
Early voting took place on Wednesday, with soldiers, police, prisoners, hospital patients and displaced people casting their ballots ahead of the general public.
About 614,000 individuals were eligible to vote on Wednesday at 1,699 polling booths.
"Participation has been excellent," Qassim Abudi, the administrative director of the Iraq electoral commission, said.
Nuri al-Maliki, the Iraqi prime minister, is seeking to increase his regional influence via the polls to counter rival Shia parties ahead of parliamentary elections later this year.
Sunni parties, many of whom boycotted the last provincial polls in 2005, are also aiming to gain a greater share of local power.
"Brothers and sisters, only hours are left separating us from this unforgettable day, election day," al-Maliki said at an election rally in the southern city of Amara, before voting started on Wednesday.
"What makes us happy is the preparations we are seeing today - a slap in the face of those who are betting that Iraqis will not go to the ballot boxes because they are despairing."
"Whereas the January 2005 elections helped put Iraq on the path to all-out civil war, these polls could represent another, far more peaceful turning point," Robert Malley, the Middle East and North Africa programme director at the International Crisis Group, said.
"Despite likely shortcomings, the elections may begin to redress some of the most severe problems associated with the 2005 vote, assuring fairer representation of all segments of the population," Malley said.
The UN is helping to stage the elections, in which about 15 million citizens are eligible to vote for 440 seats.
The country's borders will be closed during the elections and transport bans and night-time curfews will be in place.