The bodies of three Iranians and 90 Iraqis were handed over at the border crossing point of Shalamcha in southern Iraq, while military bands played national anthems.
All but one coffin, containing the remains of an Iraqi soldier, were unidentified. Many were draped in the national flag of each soldier's country.
The victims came from border areas that witnessed major battles in the war.
Although the Iran-Iraq war ended over 20 years ago, the fate of many soldiers on both sides remains unknown.
"The Iraqi-Iranian borders are long, this is why searching for bodies needs a lot of effort and time," said Mehdi al-Tamimi, an official with the Iraqi government's human rights office in Basra.
Since 1996, Iraq has received 2,229 bodies from Iran and Tehran received 1,473 bodies from the Iraqi side through the Shalamcha crossing point alone, Tamimi said.
Sunday's swap was the seventh between the two countries since 2003.