More than 7,000 others also injured in Sunday’s quake, reports Iranian Fars news agency.
The epicenter of the quake was located around 32 kilometers (20 miles) southwest of the city of Halabja, near the Iranian border, and 103 kilometers (64 miles) southeast of the city of Sulaymaniyah, at a depth of 33 kilometers, and hit at 9:18 p.m. local time (1818GMT), said the U.S. Geological Survey.
Iran's supreme leader Ayatollah Ali Khamenei extended his condolences to the Iranian people, especially the bereaved families of those killed in the earthquake.
“It’s with deep sorrow that I've received tragic news of an #earthquake, resulting in death & injury of our dear countrymen, causing much damage,” Khamenei tweeted.
Kermanshah governor’s office said there will be three days of mourning in the province.
Kermanshah’s deputy governor had earlier announced the death toll was 129 with around 1,000 injured, according to the semi-official Fars news agency.
Iranian President Hassan Rouhani said he appointed Vice-President Eshaq Jahangiri to mobilize resources to help earthquake victims.
Meanwhile, the Iraqi Interior Ministry said seven people were killed and 321 injured in northern Iraq.
According to Iraqi media, the earthquake damaged buildings in certain areas of Kirkuk and Sulaymaniyah.
The quake was followed by a dozen aftershocks ranging from 3.1 to 4.1 in magnitude, according to the U.S. Geological Survey.
It damaged telephone cables, Internet connections and power lines throughout various towns and villages.
The quake also destroyed a number of buildings in rural areas and caused cracks in the walls of villages and towns some 122km (76 miles) west of Kermanshah city, Fars reported.
The earthquake was also felt in Turkey's southeastern and eastern regions, including Diyarbakir, Batman, Mardin, Hakkari, Van, Mus and Sirnak provinces.
It was also felt as far away as Kuwait, Syria, Lebanon and Pakistan.