The attack, which wounded at least 102 other people, occurred at around 7:30 am local time in the Baab al-Muatham neighbourhood of central Baghdad, the official told AFP.
The official death toll of 18 was initial, said Deputy Health Minister Khamis al-Saad, and could rise.
The attack occurred at the site of what used to be the Defence Ministry under Saddam Hussein, turned into an army recruitment centre and military base after the 2003 US-led invasion.
One army source who declined to be identified said there might have been two suicide bombers, a hallmark of Al-Qaeda and its local affiliates.
“They (the recruits) were gathering in large numbers. They let in 250 recruits at a time,” the source told Reuters.
The bloodshed was the latest in a steady drumbeat of attacks since a March 7 election produced no outright winner and as yet no new government.
While overall violence in Iraq has fallen sharply since the height in 2006-07 of the sectarian slaughter between majority Shias and once dominant Sunnis, a stubborn insurgency remains capable of carrying out large scale attacks.
Iraqi and US officials say the insurgents are trying to exploit political tensions stirred up by unsuccessful coalition talks between the major Shia political factions and a Sunni-backed cross-sectarian alliance which won a narrow victory in the March election.
They are also putting the Iraqi security forces to the test ahead of the formal end of US combat operations this month and the reduction in US troop levels to 50,000 by Sept. 1, part of a plan leading to a full-scale withdrawal in 2011. —Agencies
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