The Kurdish regional government's envoy to Washington, Qubad Talabani, told The Associated Press the three were tourists and are in Iranian custody. He said the Americans mistakenly crossed into Iranian territory Friday at the border town of Ahmed Awaa.
"The Iranians said they have arrested them because they entered their land without legal permission," he said.
Iranian officials have made no comment. Iran's embassy in Baghdad was closed Saturday.
The self-ruled Kurdish region has been relatively free of the violence that plagues the rest of Iraq. Foreigners often feel freer to move around without security guards in the area, and tourists have been known to visit the scenic area.
A senior security official in Sulaimaniyah, near the Iranian border in northern Iraq's oil-rich Kurd region, said Saturday the three were last heard from after they contacted a friend saying they entered Iran by mistake and troops surrounded them. There has been no contact with them since, he said.
He also said Iranian officials have confirmed to Iraqi authorities the three were arrested.
The official, who asked not to be named because he was not authorized to speak to the media, said the friend they'd contacted, the fourth member of their group, was feeling sick and had stayed behind in Sulaimaniyah. No other details were available.
State Department spokesman Robert Wood said Friday the U.S. Embassy "is aware of the report and is investigating. We are using all available means to determine the facts in this case."
U.S. helicopters were buzzing overhead and many U.S. Humvees had moved into the Kurdish city of Halabja to search for the Americans, said a Kurdish border force official.
According to the security official, the missing Americans were tourists hiking near Halabja and Ahmed Awaa.