A senior Canadian government official was quoted as describing the move as a "tactical pause."
The NATO mission run by Canadian General Jennie Carignan is reportedly a "non-combat, advisory and training" mission, Xinhua news agency reported.
The suspension of NATO's training mission, where 253 Canad are involved, does not affect the US-led Operation Impact where Canada has approximately 600 soldiers servicing in Iraq, Kuwait, and Jordan and Lebanon as trainers and advisers, according to the report.
Canadian Foreign Minister Francois-Philippe Champagne on Friday called on all sides to exercise restraint and pursue de-escalation after a US airstrike near Baghdad International Airport killed Iranian Major General Qassem Soleimani, who was commander of Iran's Islamic Revolution Guards Corps Quds Force.
"Canada is in contact with our international partners. The safety and well-being of Canad in Iraq and the region, including our troops and diplomats, is our paramount concern. We call on all sides to exercise restraint and pursue de-escalation. Our goal is and remains a united and stable Iraq," Champagne said in a statement.
Canada also urged its citizens in Iraq to consider leaving the country in updated travel advisory on Friday after the attack.
"This attack has led to increased tensions in the region," the advisory said. "There is an increased threat of attacks against Western interests and of terrorist attacks in general. Consider leaving by commercial means if it is safe to do so."
The United States has urged its citizens in Iraq to leave "immediately," following the attack.
Iran has vowed "harsh retaliation" against the United States for what Iranian President Hassan Rouhani has called a "heinous crime" after Soleimani was killed.
( With inputs from IANS )