U.S. Defense Secretary Leon Panetta took part in a ceremony marking the end of the U.S. military mission in Iraq, after close to nine years of war and the deaths of nearly 4,500 American soldiers.

Panetta said the ceremony Thursday in Baghdad marked a “historic occasion” for both the Iraqi and American people. He said the dream of an independent and sovereign Iraq is now a reality.

The ceremony comes weeks ahead of a December 31 deadline for the remaining U.S. soldiers to withdraw from Iraq.

On Wednesday, U.S. President Barack Obama paid tribute to those who served in the war, and said the United States is leaving behind a sovereign, stable and self-reliant Iraq. He described that as an “extraordinary achievement” as he spoke at the Fort Bragg military base in North Carolina.

Mr. Obama said the future of Iraq is now in the hands of the Iraqi people.

The war in Iraq, which began in March 2003, claimed the lives of tens of thousands of Iraqis.

In Iraq Wednesday, hundreds of people in the city of Fallujah took to the streets to celebrate the withdrawal of U.S. troops from their country. They shouted slogans and held banners, and some burned U.S. and Israeli flags. Fallujah, to the west of Baghdad, was once a center of insurgency against U.S. forces.

On Monday, Mr. Obama and Iraqi Prime Minister Nouri al-Maliki outlined a broad agenda for post-war cooperation, pledging to ensure Iraq's political stability and strengthen its national security.

The White House says it believes Iraq is ready to handle its own security, and that while there will be violence, it has been diminishing as key figures resolve differences democratically.