MOSUL, Iraq (Reuters) - Bombs in Baghdad and northern Iraq killed at least 41 people and wounded more than 80 on Thursday, police said, just over a week after U.S. troops handed security in city centers to local forces.

Two suicide attacks in Tal Afar, a town 420 km (260 miles) northwest of Baghdad that is mainly home to minority Turkmen, killed 34 people and wounded 60.

One suicide bomber detonated an explosives vest, followed by another suicide attack just as people responded to the first, said a police official in Nineveh province, where groups like al Qaeda have taken advantage of tensions between Sunni Arabs and ethnic Kurds to maintain a campaign of violence.

In Baghdad, seven people were killed and 20 were wounded by two bomb blasts in a market in Sadr City, a poor, Shi'ite Muslim area of the Iraqi capital.

Police said both bombs were placed among rubbish piles in the popular Sadr City market. Reuters Television footage showed the blood-stained interior of a minivan damaged in the attack.

STRONGHOLD

The bloodshed following the U.S.-led invasion in 2003 has dropped sharply, but ethnically and religiously mixed Nineveh province in Iraq's north is still wracked by violence.

There has been a steady flow of attacks in Nineveh's capital, Mosul, many of them targeting Iraqi police and soldiers, since U.S. combat troops withdrew from urban centers on June 30.

Mosul is viewed as a last stronghold for al Qaeda and other Sunni Arab insurgents. It is also a frontline in a simmering dispute between the Shi'ite Arab-led government in Baghdad and Kurds, who want to extend the borders of their semi-autonomous northern region and take greater control of oil resources.

While Shi'ite-Sunni violence has faded, Kurd-Arab tensions are viewed by many as the country's next major threat.

On Wednesday, two car bombs exploded within minutes of each other in Mosul, killing 14 people and wounding 33.

The attacks raise questions about whether Iraqi forces can fend off violence as they take the lead role for security.

The U.S. pullback from city and town centers last month was a milestone in the plan for a gradual withdrawal of all U.S. forces from Iraq by the end of 2011.

"Terrorists are trying to reignite sectarian strife in Tal Afar, especially after the U.S. withdrawal," said local resident Khalil Tal Afari.

He said insurgents were trying to make Tal Afar, the site of horrific violence since 2003, again a base for their attacks. "We will stand up to them," Afari said.

Hussein Atrish, head of Tal Afar's town council, said insurgents were trying to roll back efforts to bridge divisions between Sunnis and Shi'ites in the area.

"The biggest problem is that there are people who are not comfortable with this reconciliation ... Terrorists do not welcome this," he said.

(Reporting by a correspondent in Mosul; writing by Missy Ryan)