The Islamic State jihadist group has taken credit for the gun attack at a popular Istanbul ' title='nightclub in Istanbul '>nightclub in Istanbul which killed 39 people on New Year's Eve, mostly foreigners, and injured 70.

The group said in a statement the attack was carried out by "a heroic soldier".

"In continuation of the blessed operations that Islamic State is conducting against the protector of the cross, Turkey, a heroic soldier of the Caliphate struck one of the most famous nightclubs where Christians celebrate their apostate holiday," the statement said.

The IS accused Turkey of shedding the blood of Muslims through "its air strikes and mortar attacks" in Syria.

IS released the statement on the encrypted messaging service Telegram. The group also claimed a bombing in Baghad's Shia Sadr City district on Monday that killed at least 35 people and blasts at two Shia markets that killed at least 28 in the Iraqi capital on Saturday.

The attack on the Reina nightclub was the first attack in Turkey claimed by the group, which Turkish authorities suspect of being behind several deadly bombings in the country over the past year.

Eleven Turks and 28 foreigners died late on Saturday when a gunman entered the Reina, which was packed with around 600 revellers. 

The killer randomly fired up to 180 bullets at people with a long-barrelled gun in an assault lasting seven minutes.

Bollywood producer Abis Rizvi was one of those who died. Some partygoers who managed to flee jumped into the freezing cold Bosphorus Strait to escape.

Seven of the victims were from Saudi Arabia, three each from Iraq and Lebanon, two each from Jordan, India and Morocco and one each from Syria, Israel, France, Tunisia, Belgium, Kuwait, Canada and Russia.

The body of one victim was not immediately identified. Three people wounded in the assault remain in critical condition, Turkish Prime Minister Binali Yildirim said on Sunday.

Turkey has launched a massive manhunt for the gunman, who managed to escape after the attack and was not immediately identified.

Turkish media reports quoted police sources as saying he may have been from Uzbekistan or Kyrgyzstan. 

"We hope the attacker will be captured soon," said Interior Minister Suleyman Soylu. He called the attack "a massacre, a truly inhumane act of savagery".

Security measures had been heightened in major Turkish cities since the attack, with police barring traffic from key squares in Istanbul and in the capital Ankara.

In Istanbul, 17, 000 police officers were put on duty, some disguised as Santa Claus and others as street vendors, Turkey's Anadolu news agency reported.

Turkey is currently in a state of emergency following a failed coup in mid-July. 

A member of the US-led coalition against IS, the country faces multiple security threats including the fallout from the war in neighbouring Syria.

Over 180 people died in a series of attacks in Turkey last year, some carried out by Kurdish militants, according to officials.