An Iraqi journalist told Aljazeera the blast occurred on the main highway, between al-Yarmuk and al-Dakhiliya neighbourhoods, leading to the airport.
A US army captain on the scene said the explosives-laden vehicle had pulled up next to a US patrol before detonating, killing the bomber inside.
Two US soldiers and two Iraqi policemen suffered injuries in the blast that occurred at 7.45am (0545 GMT).
Two mortar rounds had landed near the same area about 20 minutes earlier, spokesman Colonel Adnan Abd al-Rahman said.
Witnesses told the Iraqi journalist that a Humvee in a US army convoy had been damaged.
This could not be confirmed as US forces and Iraqi police have sealed off the area, preventing reporters from approaching.
The explosion left a huge crater in the ground and car parts strewn across the area.
The US state department has described the airport road as among Iraq’s most dangerous.
The bodies of four children were
In continuing unrest elsewhere in the conflict-stricken country, overnight air raids on the city of Falluja left six Iraqis dead, all members of one family.
The family of four children and their parents, had just returned after fleeing the city a week earlier, witnesses said.
A building housing the Institute for Female Teachers was among several structures damaged in the attack.
Residents denied the existence of any armed groups at the targeted site. US aircraft have made regular bombing runs over the city in recent weeks under the pretext of targeting alleged al-Qaida member Abu Musab al-Zarqawi.