The blast sent a mushroom cloud of dust and debris rising over the Green Zone. US jets and helicopters roared over the city.
The blast ripped through the building in the early afternoon, only half an hour after about 400 people left a party celebrating the 29th anniversary of the founding of the PUK, whose militia fought alongside American soldiers in the invasion that toppled Saddam Hussein last year.
Party leader Jalal Talabani was not in the office when the blast occurred, a party spokesman said.
Outside the capital, a roadside bomb exploded near the US military base, killing 11 Iraqis and wounding 23, near Beiji, 155 miles north of Baghdad. Two First Infantry Division soldiers were also wounded, the military said.
Despite the talk of stability and a new beginning for Iraq as the interim government took shape, violence continued in widely scattered parts of this country.
US troops fought Shi'ite militiamen loyal to radical cleric Moqtada al-Sadr in the Sadr City neighborhood of Baghdad and in Kufa, near Najaf, where Shi'ite leaders have been struggling to save a shaky cease-fire.
The US-appointed governor, Adnan al-Zurufi, said coalition authorities proposed that Sadr's militia withdraw from Najaf over a 72-hour period. In return, American troops would stay away from Shi'ite holy sites.
