BANGKOK, Dec 29 (Reuters) - Narongchai Vachiraban netted a spectacular second-half free kick to give hosts Thailand a 1-0 victory over Asian champions Iraq in the King's Cup final on Saturday.

Iraqi goalkeeper Dydar Hassan stood and watched as Naraongchai's well-taken effort in the 65th minute sailed into the top right hand corner from 20 metres, sparking jubilant scenes at the Rajamangala stadium in Bangkok.

The victory was Thailand's 13th in the 38-year history of the King's Cup, which was donated by Thailand's revered monarch Bhumibol Adulyadej, who turned 80 earlier this month.

Thai coach Charnwit Polcheewin was delighted with the win -- the Thais' fourth in seven days -- which he said was ideal preparation for the next round of World Cup qualifiers in February.

"It was a difficult match, but we worked hard on our set pieces and it paid off," Charnwit told reporters.

"Iraq were good as a team as well as individuals, but four wins from four against teams outside of Southeast Asia shows we are making the step up."

The Iraqis put on an impressive display of attacking, despite the absence of their Asian Cup-winning players, with Salah Hasan Alkhafaji a constant menace to the Thai defence.

He had three shots saved by keeper Kosin Hatthairattankul inside the opening eight minutes and had a goal disallowed by the Thai referee for offside shortly after the break.

Thai strike pairing Surayud Chaikamdee and the energetic Teerathep Winothai troubled the Iraq defence throughout the match and both came close to scoring on two occasions.

That pressure finally paid off when Thailand were awarded a disputed free kick for a foul on Suchao Nutnam, which Narongchai blasted into the top right hand corner to seal the victory.

Iraqi coach Akram Salman, deputising for Norwegian Egil Olsen, said his young players, all picked from the domestic league in the war-torn country, had shown Iraq's strength in depth.

"I brought them here to prepare them for international football and they did very well," he told reporters.

"We could have scored five goals in the first half and we had a goal wrongly disallowed. That was a great goal, but we are in Thailand and it was Thailand's victory today."

(Reporting by Martin Petty, editing by Alan Baldwin)