Mohammed, 55, a journalist and feminist fighting for democratic principles and human rights, is the co-founder and head of the Organisation of Women's Freedom in Iraq, which provides protection to women victims of violence.
"Sexual violence is often part of battle plans, and Iraq is just one of many places where women's rights are sacrificed for political and military objectives," the Rafto Foundation said.
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In Iraq, "there has been a huge increase in abuse and violence against women, including rape, abduction into prostitution and honour killings," it added.
Human rights violations are being committed by many parties in Iraq, not only the Islamic State jihadists but Iraqi authorities and groups supported by the international community as well, it said.
Among previous winners of the Rafto Prize, named after Norwegian historian and human rights activist Thorolf Rafto, are four who have gone on to win the Nobel Peace Prize, also awarded in Norway: Aung San Suu Kyi, Jose Ramos-Horta, Kim Dae-Jung and Shirin Ebadi.
The winner of this year's Nobel Peace Prize will be announced on October 7.