Due to United States and the international sanctions on Iraq along with excessive government printing, the Saddam dinar currency devalued quickly.

During the Iraqi no-fly zones conflict, Swiss dinars notes continued to circulate in the then politically isolated Kurdish-populated northern Iraq.

The northern Iraqi Kurdistan government that was created as a result, refused to accept the inflated Saddam dinar notes (which were issued in huge amounts).

By having its own stable supply of the Swiss Iraqi dinars, the politically isolated region effectively evaded inflation, which ran rampant throughout the rest of the country.

Between 15 October 2003 and 15 January 2004, the Coalition Provisional Authority issued new Iraqi dinar notes and coins, with the notes printed by the British security printing firm De La Rue using modern anti-forgery techniques to "create a single unified currency that is used throughout all of Iraq and will also make money more convenient to use in people's everyday lives".

On 19 December 2020, Iraq's Central Bank devalued the dinar by 24% to improve the government's revenue, which was affected by the COVID-19 pandemic and low oil prices.

[16] In 2014, Keith Woodwell (director of the Utah Division of Securities) and Mike Rothschild (writer for Skeptoid blog) stated that the speculation over the Iraqi dinar originated from a misunderstanding of why the value of the Kuwaiti dinar recovered after the First Gulf War, leading to an assumption that the Iraqi dinar would follow suit after the fall of Saddam: Woodwell and Rothschild noted substantial differences in economic and political stability between Iraq and Kuwait, with Iraq facing pervasive sectarian violence amid near-total reliance on oil exports.

[23] These alerts usually warn potential investors that there is no place outside Iraq to exchange the dinar, that they are typically sold by dealers at inflated prices, and that there is little evidence to substantiate the claims of significant appreciation of their investment due to revaluation of the currency.

These notes were manufactured in England by De La Rue and were of significantly higher quality than those later produced under the economic sanctions that were imposed after the first Gulf War.

In March 2014, the CBI began replacing banknotes with anti-counterfeiting enhanced versions that include SPARK optical security features, scanner readable guarantee threads in addition to braille embossing to assist vision-impaired persons.

Persons holding these banknotes were advised to immediately redeem them at their nearest bank for the IQD 250 and higher denomination dinar notes at a one-to-one rate at no charge.

They feature an outline map of Iraq showing the Euphrates & Tigris rivers as well as the Great Mosque of Samarra and the head of a purebred Arabian horse as a watermark.

However, the most notable change was with the 1,000-dinar note, which was redesigned after social media users noticed that Surah Al-Ikhlas was written in the center of its front side.

Investing in the Iraqi dinar (IQD) represents a high-risk financial strategy that attracts speculative investors hoping for potential future currency appreciation.

The investment involves purchasing Iraqi dinars with U.S. dollars, based on speculation about Iraq's potential economic recovery.

Investors face numerous significant challenges, including extremely limited trading volume, high transaction fees that can reach up to 20%, and widespread scams within the currency exchange market.

The currency's value remains heavily dependent on Iraq's complex political landscape, ongoing economic instability, and fluctuating oil prices.

Despite Iraq's substantial oil reserves, which could potentially support future economic growth, purchasing dinars is not considered a reliable investment strategy.

The currency's fixed exchange rate and restricted trading options make it an particularly unattractive investment for international investors.

As of September 2024, one U.S. dollar remains worth approximately 1,310.6 Iraqi dinars, underscoring the currency's current limited international value and speculative nature.