An attempt has been made to assess the overall groundwater quality and identify major variables affecting the groundwater quality in the urban area of Baghdad, Iraq. Groundwater samples from tube wells of 66 sampling sites were analyzed for the major physicochemical variables during May 2010. From the Hill–Piper trilinear diagram, it is observed that the majority of ground water from sampling sites are Ca2+ -Mg2+ -Cl- -SO42- type and Na2+ -K+ -Cl- -SO42- type water. Multivariate statistical techniques such as factor analysis and cluster analysis were applied to identify the major factors (variables) corresponding to the different source of variation in groundwater quality of Baghdad. Factor analysis identified three major factors explaining 82.506% of the total variance in water quality; and the major variations are related to degree of mineralization of the geological components of soils, irrigation return flow, agricultural activities and mixing of wastewater. Hierarchical cluster analysis revealed three different groups of similarities between the sampling sites, reflecting different physicochemical properties and pollution levels in the groundwater quality.