The Wednesday blast in the Dura District of south Baghdad also wounded at least 50 people, the sources said.
The bomb went off while worshippers were leaving the church, police said, and most of the victims were Christian.
They were celebrating the birthday anniversary of the Jesus Christ (PBUH), when the terrorist attack happened.
Al-Qaeda-linked groups have been blamed for similar attacks in the past.
A rise in unrest has forced Iraqi officials to appeal for international help in fighting the country's worst bloodshed since 2008, just months before Iraq's first elections in four years.
The surge in violence nationwide has pushed Iraq's death toll for 2013 around 6,000.
Iraq has seen wave of violence since 2001, when the US-led invasion put the Arab nation in an unstable situation and threatened by daily terrorist attacks.
NTJ/BA