MPs will meet to elect a speaker Thursday, with the deal paving the way for an end to a months-long power vacuum that has witnessed growing violence in Iraq.
Washington had expressed mounting exasperation with the protracted coalition talks but had pushed throughout for a unity government that gave a stake to all of Iraq's ethnic groups.
Patrick Cocburn of the British daily newspaper, The Independent, says the deal represents a balance of power.
"The Sunni community has been rhetorically included at bit more, but hasn't got much," he says. "The Americans are saying they're happy, but they haven't got what they were after. And the Iranians have, but I think it is somethng that will last."
The Iraqiya bloc of former prime minister Iyad Allawi, who had held out for months to take the premiership from incumbent Nuri al-Maliki, confirmed it had signed the deal.
"I can confirm that there was an accord last night but I cannot give details," Iraqiya spokesman Intissar Allawi told AFP.
Government spokesman Ali al-Dabbagh said that Iraqiya had agreed to accept the position of parliament speaker, and not the premiership or the presidency they had long sought.
Under the power-sharing arrangements between Iraq's divided communities, one post goes to a Sunni Arab, one to a Kurd and one to a representative of the Shiite majority.
The election of the speaker will pave the way for incumbent President Jalal Talabani of the Kurdish former rebel group, the Patriotic Union of Kurdistan to be kept in office for a term.
It will then fall to him to name a prime minister-designate who will have one month to form a government that can win a parliamentary majority.