But the US general in charge of detention facilities in Iraq says Iraqi forces are ready to take over the responsibility.
"There is overwhelming evidence they are equipped, prepared and poised to take over," Major General Jerry Cannon said.
In a ceremony, Cannon handed over a giant key of the prison to Dara Noureddin, Iraq's minister of justice.
"We will make sure this prison is a model for all prisons," Noureddin said.
The US continues to hold 200 other detainees, including eight members of Saddam Hussein's ousted government, in a seperate part of the prison dubbed Compound 5.
The high-security detention centre houses an estimated 1,500 detainees, excluding the 200 still held by the US.
With the exception of these 200 inmates, there are no more prisoners in US custody in Iraq, Cannon said.
A day before Camp Cropper's handover, Iraqi offficials said the US had turned over 55 former officials in Saddam Hussein's government since last year, including Tariq Aziz, the former foreign minister.
These former officials will "be treated fairly, transparently and truthfully" under Iraqi laws, Ali al-Dabbagh, a government spokesman said.
Aziz's son voiced concerns over how his father would be treated by Iraqi authorities.