The directive from Sistani came after parliament pushed back against Prime Minister Haider al-Abadi's reform drive earlier in the week, saying its legislative powers must not be usurped during the process.
"Legislative and other authorities should not take the need to protect the constitutional and legal path as a means of circumventing reform measures," Sistani said in remarks read by a representative at Friday prayers.
Sistani, who is revered by millions and has unmatched prestige in Iraq, has played a key role in supporting reforms by calling for the government to carry them out, giving Abadi the political cover to move forward with changes.
In a sign of the importance Sistani attaches to change, he told AFP earlier this year that if "true reform" is not realised, Iraq could be "dragged to... partition and the like, God forbid."
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In response to popular protests and calls from Sistani, Abadi announced reforms including scrapping the posts of deputy premier and vice president, streamlining the cabinet, cutting salaries for officials and slashing their huge number of guards.
Parliament approved a reform programme proposed by Abadi along with its own series of proposed changes, but now appears to be trying to assert greater control over the process.
On Monday, parliament said that while it supports reforms, it "denies the delegation of any of its legislative powers to any executive side, and calls on all authorities to abide by their work according to the constitution."
A dispute between parliament and Abadi could further hinder reform efforts by the premier, who has already struggled to effect signficant or lasting changes.
The endemic nature of corruption and the fact that officials are limiting their own privileges by implementing some changes are already major obstacles to reform.