After weeks of wrangling, MPs on Sunday finally passed the electoral law that will govern the contest, the second national polls since the US-led invasion that ousted dictator Saddam Hussein six years ago.
The environment in which the general election takes place is likely to be radically different from that of the previous national ballot in December 2005.
Sectarian strife between the nation's Shiite and Sunni communities was then rising and at its peak in 2006 saw an average of 63 people being killed each day, compared with less than 10 deaths per day so far this year.
Faraj al-Haidari, head of Iraq's Independent High Electoral Commission (IHEC) said the vote would take place on January 21.
"We sent a letter today to the presidency and we have received confirmation in a telephone call that they accept the date," he said.
The approval of the electoral law on Sunday was praised by US President Barack Obama and UN chief Ban Ki-moon, who said the vote was key to maintaining stability and helping Iraqis move towards a lasting peace.
Christopher Hill, the US ambassador to Baghdad, said the planned US troop withdrawal can go ahead as scheduled now that the electoral law is in place.
"We're good to go on a January date," he told reporters in a conference call from the Iraqi capital late Sunday after the electoral law was approved.
"The concern of course was had these deliberations gone on, then new decisions would have had to be made about the (military) drawdown."
There are currently 117,000 American soldiers in Iraq. All combat troops are due to leave the country by August 2010 ahead of a complete military pullout by the end of 2011.
The election was originally billed for January 16 but delays on whether an open or closed voting system would be used and working out how the ballot would proceed in the ethnically divided oil province of Kirkuk forced it to be put back.
The ballot will also differ from 2005 in that it is set to be fought on political rather than sectarian lines, ushering in a much altered parliament.
Electors, who under an open voting system will choose either a single named candidate -- which favours high profile politicians -- or a party, will also have much more choice on their ballot paper than last time round.
Two Shiite alliances, including the State of Law grouping headed by Prime Minister Nuri al-Maliki, two Sunni blocs, two secular lists and three Kurdish groups make up the main contenders.
However a total of 296 parties are set to campaign, compared with just 12 party lists who won seats in 2005.
"In the next parliament, the conflict will be more about secular and religious politics, rather than Sunnis and Shiites," Ibrahim al-Sumaidaie, a noted Iraqi political analyst, told AFP.
The number of seats up for grabs will be 323, up from 275 in 2005, based on one parliamentary representative for every 100,000 Iraqis.
The electoral law guarantees that 25 percent of MPs will be women and allocates at least eight parliamentary seats for minorities, including five for Christians.
A compromise saw MPs decide that the election result will be provisional in Kirkuk and other provinces where there is disagreement over electoral rolls because of a high recent increase in respective Kurd and Arab populations.
Kurds have long demanded the incorporation of Kirkuk in their northern autonomous region despite the opposition of the province's Arab and Turkmen communities.
Arabs and Turkmen say a huge number of Kurds have settled in Kirkuk since Saddam's overthrow, but Kurds contend they were only returning to an area from which they were forced out of during the now executed dictator's reign.
A committee of parliamentarians, officials from government ministries and IHEC, with the help of the United Nations, will have one year to review the vote in Kirkuk and cancel fraudulent ballots.
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