Colonel Kadhem Abbas of the Iraqi police said the two Germans worked at a detergent plant inside an industrial complex surrounding Baiji's oil refinery, the biggest in Iraq.
The deputy governor of Salah Al-Din Province, Abdullah Jubara, confirmed the men had been seized.
Baiji, which lies 180 km north of Baghdad, has been the site of a great deal of insurgent activity in recent months.
Separately, the U.S. military have announced that two U.S. soldiers were killed in a roadside bomb and two Marines died in a vehicle accident in western Iraq. All four of the troops died on 23 January.