Iraq's parliament voted on Saturday to reject a draft law that allows troops from Britain, Australia and several other countries to remain beyond the end of this year.
A a member of the Sunni Accordance Front said lawmakers objected to it being in the form of legislation, rather than an agreement as was the deal Iraq signed with the United States.
The current UN mandate allowing foreign troops to be in Iraq expires on 31 December.
The rejected bill covered the future of troops from Britain, Australia, Romania, Estonia, El Salvador and NATO.
The US-Iraqi security pact sets a withdrawal date for US troops in Iraq at the end of 2011 and gradually restricts their activities. The US currently has 140,000 troops there.