The military said in a statement that the Marines were conducting a foot patrol when the bomb went off. The statement said the bomb was made from several large artillery shells.
The incident is one of the worst single incidents to hit the U.S. troops in the war.
Earlier, the military announced that U.S. and Iraqi troops have launched a new anti-insurgency operation in the Iraqi town of Al-Ramadi. The military said the new offensive is being waged to ensure the success of the parliamentary elections due on 15 December.