Council spokesman Mohammed al-Khuzaie described the decision as a show of support for "the oppressed people of Bahrain.”
Khuzaie said Gulf Air was targeted due to its ties to the state, and that the decision would remain in effect until further notice.
Bahraini protesters have been staging anti-regime demonstrations since February 2011, and they hold King Hamad bin Isa Al Khalifa responsible for deadly crackdowns that have left scores of demonstrators dead.
The demonstrators say they will continue holding street protests until their demand for the establishment of a democratically-elected government is met.
Officials in Iraq's Najaf Province have banned the flights operated by Bahrain's carrier in a show of solidarity with anti-regime protesters in the Persian Gulf kingdom.
"The committee formed to oversee the airport decided to ban the Bahraini company Gulf Air from conducting flights to Najaf in solidarity with the Bahraini people who are subjected to repression by authorities there," Najaf provincial council said in a statement on Thursday.
Najaf provincial council made the decision on the day when Gulf Air was resuming flights to various destinations in Iraq after a break of more than a year.
The flights were halted in March 2011 after Bahraini security forces backed by a Saudi troops and mercenaries launched a brutal crackdown on peaceful protesters demanding the downfall of the ruling Al Khalifa family.