Turkish Prime Minister Tayyip Erdogan warned Iraqi Prime Minister Nuri al-Maliki on Tuesday that Turkey would not remain silent if he pursued a sectarian conflict in his country and said Ankara did not favour any ethnicity or sect in the region.

Erdogan's warning was the latest in a war of words between the two neighbours that has added to already heightened regional tension. Turkey fears Iraq is heading towards a full-scale sectarian war while Baghdad has accused Ankara of meddling.

"Esteemed Maliki should know this, if you start a period of conflict in Iraq within a sectarian struggle, it will be impossible for us to remain silent," Erdogan told his AK Party parliamentary group in the Turkish capital.

Iraq summoned the Turkish ambassador in Baghdad last week to complain about comments by some Turkish officials it said amounted to interfering in its internal affairs.

While Iraq did not specify what Turkish remarks they were angry about, the complaint appeared to stem from comments this month by Erdogan, who said a Sunni-Shi'ite conflict in Iraq, if unleashed, could engulf the entire Islamic world.

Fears of renewed sectarian conflict in Iraq have increased since US troops withdrew in December and Maliki's Shi'ite-led government sought the arrest of a Sunni vice president on accusations he ran death squads.

Maliki's government denies it has a sectarian agenda, but the arrest warrant threatens to wreck a fragile ruling coalition that saw Sunni and Kurdish groups join Maliki's cabinet.

Mainly Sunni, but officially secular Turkey, has sought to play a bigger diplomatic role in the Middle East, backed up by its growing might as the world's 16th biggest economy.

But while Ankara insists it maintains its official "zero problems with the neighbours" foreign policy, its support for Syrian demonstrators has drawn it into tensions with Iran, one of the main backers of the Damascus government.

Analysts say Turkey has heavily courted Sunni and Kurdish political blocs in Iraq in recent years, while Iraq's Shi'ite parties remain closer to Shi'ite Iran.

In an interview with al-Hurra television this month, Maliki said: "Turkey is unfortunately playing a role which may lead to disaster and civil war in the region."

On Tuesday, Erdogan described Maliki's comments about Turkey meddling in Iraq's affairs as "unfortunate" and "ugly".

"That Turkey is backing or is against a particular ethnic group or sect, whether in Syria or Iraq or in any other country in the region, is out of the question," Erdogan said.

"We see every problem in our region from a position of peace, stability and loyalty."

At least two rockets were fired at the Turkish embassy in Baghdad last week, Iraqi and Turkish sources said, prompting condemnation from Ankara which said it expected Iraq to take steps to provide security for Turkey's diplomatic missions.

Iraq is now Turkey's second biggest export market after Germany, with trade volumes between the two reaching nearly $12 billion in 2011, Turkey's economy minister said during a visit to northern Iraq last week.

More than half of that trade is with Kurdistan, which puts the region in Turkey's top-10 trading partners.