Iraq's two main Shia groups, which performed strongly in recent elections, have merged to form the biggest alliance in the new parliament.
The bloc, to be called the National Alliance, brings together the prime minister's coalition with other Shia factions, including followers of radical cleric Moqtada Sadr.
It will be just short of an absolute majority in parliament but well ahead of the rival secular-Sunni bloc.
The new parliament opens on Monday.
After weeks of negotiations, the two Shia coalitions announced they were forming one bloc, and said they had notified the acting speaker of parliament.
The new alliance is made up of outgoing Prime Minister Nouri Maliki's State of Law coalition - which came runner-up in the March election - and the third-placed Iraqi National Alliance, along with other Shia factions.
Together, they will command just four seats short of an absolute majority, well ahead of the 91 seats held by Iyad Allawi's secular-Sunni bloc, although it came out first in the elections, with a narrow two-seat lead.
Karim Yaqoubi, an INA member, said the Kurdish Alliance would join the new Shia grouping to give them a majority.
The BBC's Jim Muir in Baghdad says that both the Shia and secular-Sunni blocs will now be claiming the right to be asked to form a government. The constitution is unclear on the issue.
In any case, our correspondent says, the Shia bloc has not yet decided who it wants to nominate as prime minister. So the betting is that the first session of parliament will be declared open, and suspended indefinitely until a power-sharing deal is hammered out.