Cystic echinococcosis (CE) or hydatidosis is a neglected zoonotic disease that is caused by the larval stage of Echinococcus granulosus sensu lato. It is still found in Iraq and is having a significant public health and economic impact on both human and livestock populations. It is maintained in a dog–livestock transmission cycle with domestic dogs as definitive hosts and herbivorous animals as intermediate hosts, particularly sheep. A human host is an accidental intermediate host when it ingests parasite eggs which are present in food, water or the environment. Hydatidosis has been reported from all parts of Iraq but the prevalence of the disease is different between governorates and this is attributed to differences in the livestock production, environmental conditions, slaughtering practices, veterinary services, and public awareness. The present review describes the current epidemiological situation of hydatidosis in Iraq, focusing on human and animal prevalence, geographical distribution, transmission pattern, major risk factors, socioeconomic impacts and control measures. Current challenges and the future priorities for surveillance and disease prevention with One Health are also discussed. Epidemiological surveillance, better slaughterhouse hygiene, effective management of stray dogs and better educating the community are key to reducing the burden of hydatidosis in Iraq.