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One person died while eight were injured in the explosion at the Calso base. Former pro-Iranian paramilitary group Hashed al-Shaabi is stationed at the base, AFP reported citing an interior ministry source and a military official.
The overnight attack inflicted "material losses" and casualties, read a statement by Hashed al-Shaabi, an umbrella outfit of mostly Shiite armed groups that was formed to fight ISIS. It is now part of Iraq's security forces.
The blast hit equipment, weapons, and vehicles, reported AFP citing ministry sources. An unnamed military official seconded this, saying the blasts occurred in "warehouses storing equipment". No claim of responsibility has been made for the attack yet.
The US military said on social media that its forces were not involved in the strike. "We are aware of reports claiming that the United States conducted airstrikes in Iraq today. Those reports are not true. The United States has not conducted air strikes in Iraq today," it said.
The latest attack comes amid heightened tensions between Iran and Israel, two arch-foes in the Middle East that are on the brink of a war in the fallout of the Gaza conflict.
Earlier this month, Israel attacked Iran's embassy in Syria, killing at least 11 people including a top Revolutionary Guard commander. In response, Iran launched an unprecedented drone and missile attack on Israel earlier this week.
The tit-for-tat exchange continued with Israel launching a drone attack on Iranian soil on Friday, according to US officials. Explosions were reported near Isfahan, Iran's third-biggest city, prompting it to activate its air defence system over several cities.
Though there were reports of missiles being fired, Iran said they had shot down several drones and there had been "no missile attack for now".
Iranian Foreign Minister Hossein Amirabdollahian, while speaking to NBC News, downplayed Friday's drone attack and said so far a link to Israel had not been proven. He also termed the drones "toys that our children play with".
He also warned that if Israel acts against Iran's interests, its response will be immediate and at the "maximum level". "If Israel wants to do another adventurism and acts against the interests of Iran, our next response will be immediate and at the maximum level," he said.
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