Iraq received the Saudi deputy defence minister Tuesday, one month after hosting talks between the kingdom and its regional rival Iran to discuss a thaw in relations.
Saudi Prince Khalid Bin Salman and his delegation met with President Barham Saleh, a government official told AFP.
Saleh has said there have been meetings between the two regional heavyweights in Baghdad "more than once".
An Iraqi official and a diplomat said the talks have addressed broader regional issues, and have involved Turkey and the United Arab Emirates.
The official-level meetings aim to restore relations severed five years ago between the Sunni Muslim kingdom of Saudi Arabia and the Shiite Islamic Republic of Iran.
The initiative comes at a time of shifting power dynamics, as US President Joe Biden is seeking to revive the 2015 Iran nuclear deal that was abandoned by Donald Trump.
Baghdad, squeezed between Iran to the east and Saudi Arabia to the south, has been trying to establish itself as a mediator since the defeat of the Islamic State group in late 2017.
Recent media reports indicate there have been meetings in Damascus between Syrian President Bashar al-Assad, his intelligence chief Ali Mamluk and a delegation led by Saudi intelligence chief Khalid bin Ali al-Humaidan.