Under a deal between Baghdad and London signed last year, the last of Britain's forces left this week ahead of a July 31 deadline for their withdrawal, a spokesman for the British Embassy in Baghdad told AFP.
A small contingent of around 100 naval trainers currently de-camped in Kuwait could return once Iraq's parliament has considered a new agreement between London and Baghdad. Parliament will reconvene in September.
"As our forcesâ€™ existing permissions expire on July 31, we are now withdrawing the Royal Navy trainers while we discuss the position (of the new deal) with the Iraqi authorities," a spokesman for Britain's defence ministry said, adding that their departure was "unfortunate".
The agreement has been endorsed by Iraq's cabinet, he said adding that Britain will continue to offer training to Iraqi army officers as part of a NATO mission in the country and will provide training for Iraqi military personnel on courses in Britain.
Friday's withdrawal deadline comes just a day after Britain launched an inquiry into its role in the war. The probe will quiz key decision-makers, including ex-prime minister Tony Blair and be free to criticise government decisions.
Under Blair, Britain was a key ally of the United States when president George W. Bush ordered the invasion of Iraq in March 2003 to topple Saddam.
London's troop numbers in the campaign were the second largest, peaking at 46,000 in March and April 2003 at the height of combat operations that resulted in the dictator's overthrow and eventual execution for crimes against humanity.
Baghdad and London signed a deal last year that said all British soldiers in Iraq would complete their mission, which in recent months focused on training the Iraqi army, by June, before withdrawing completely by the end of July.
Since the invasion, 179 British soldiers have died in Iraq.
Most of Britain's troops were based in the predominantly Shiite southern port city of Basra.
Basra, Iraq's third-largest city and a strategic oil hub, had been under British command since the 2003 invasion, but the province and its airport returned to Iraqi control earlier this year.
As well as training its soldiers, Britain was instrumental in the rebirth of the Iraqi navy.
The withdrawal comes 50 years after Britain's previous exit from Iraq, in May 1959, when the last soldiers left Habbaniyah base near the western town of Fallujah, ending a presence that dated back to 1918.
It also comes a month after US forces pulled out of Iraq's towns and cities as part of a deal between Baghdad and Washington that calls for all American soldiers to leave Iraq by the end of 2011.