In a letter sent to the Iraq Football Association (IFA), FIFA raised concerns over security conditions and a breach of safety regulations in their qualifier with Jordan earlier this month, according to an AFC statement.
IFA President Najih Hmoud said Iraq would try to have the ban lifted.
"We will respect the FIFA decision and we will implement it. But I think it was not appropriate because it was based on incorrect information," Hmoud told Reuters.
The FIFA letter said Iraq would have to nominate a neutral ground in Asia for the World Cup qualifying matches by October 1 and the 2012 Olympic qualifiers by October 3.
The venue must not be one of the countries where Iraq is scheduled to play qualifiers, however.
Iraq, ranked 109 in the FIFA world rankings, lost 2-0 to Jordan on September 2 at Franso Hariri Stadium in Arbil, which appeared well over capacity and suffered a power cut during the match.
Arbil is the capital of Iraq's semi-autonomous northern Kurdish region, which was left relatively undamaged by the war and is considered among the safest areas in Iraq.
"Arbil is a safe city. FIFA could have sent a fact-finding delegation. They could have asked the attaches of foreign embassies in Arbil," Hmoud said. "I don't believe the circumstances that the report included... are enough to transfer matches to another venue.
"It is too early to nominate a new venue. There are many alternatives. We have no problem with that.
"All decisions in the world are subjected to appeal. We will follow other channels that help Iraq in lifting this ban."
The gulf nation are currently placed third in Group A of the Asian qualifiers for the 2014 World Cup alongside Jordan, China and Singapore.
