According to a press release from Millennium Relief & Development Services, the employee, who has not been publicly identified, was killed by armed attackers as he returned to his home in Iraq's capital.
The man was shot in his car as he approached his street in Baghdad's central Karrada district on the Tigris River's east bank, but the reason for the killing was not immediately clear.
The Associated Press was told by Iraqi police officials. According to police, the man's wife and child were in the car with him but were not injured.
According to officials, the man was driving down his street when he was cut off by a car, and assailants in another car shot him dead. It was unclear whether the assailants were attempting to kidnap the man, they said.
State Department spokesman Ned Price told reporters that the department is aware of reports of a US aid worker being killed in Baghdad and is investigating them.
The man had been renting an apartment in Karrada's Wahda neighbourhood since May of last year, according to documents obtained by The Associated Press.
No one immediately took responsibility for the murder.
When contacted by The Associated Press, US Embassy officials said they couldn't immediately provide any information about the case.