More than 20 soldiers from Bulgaria's unit in Iraq will be recalled within ten days.
Army Chief General Kolev said that eight of all 23 soldiers will return home on the recommendation of psychologists after having suffered from battle stress.
One of the soldiers has been recalled for breaking rules, and another because of poor health.
Thirteen soldiers have requested to quit the unit as they consider their tasks in Karbala too risky.
A proposal for terminating the mandate of the twenty-three troops has already been sent to Defence Minister Svinarov.
The Bulgarian military base in Karbala was attacked early on Thursday morning. The Defense Ministry said the mortar fire caused no damage or casualties. The attackers managed to escape.
Bulgarian troops have been deployed in the southern city as part of a 9,000-strong Polish-led multinational contingent.
Norway is the next coalition country to leave Iraq before June 30.
According to Norwegian Foreign Minister Jan Petersen, his country sees as priority the peacekeeping mission of its troops in Afghanistan.
Since Spain announced that it would pull out its 1,400 troops, Honduras, with 368, and the Dominican Republic, with 302, have also decided to withdraw their soldiers.
Meanwhile, Thailand's prime minister said his country would withdraw its non-combat troops from Iraq if they were attacked.
US Secretary of State Colin Powell has made phone calls this week to try to hold the rest of the 20-some coalition intact.