Guardsman Neil Downes, 20, from Manchester, was on patrol when his vehicle was caught in an explosion.
In the letter to his family he wrote: "Please do not be mad at what has happened. I did what I had to do and serving the British Army was it."
His mother Sheryl said her son, who was known as Tony, died a hero.
Guardsman Downes was from the 1st Battalion The Grenadier Guards.
Following the explosion, Taleban fighters then attacked the patrol with rocket-propelled grenades (RPGs) and small arms until British reinforcements arrived, the MoD said.
Mrs Downes said: "All Tony ever wanted was to be in the army. It was his life.
"We are very proud that he served as a soldier."
Guardsman Downes left the letter with his mother and his father Ronnie at their home in Droylsden, and told them it should be opened in the event of his death.
Iraq tour
Mrs Downes said: "There is one paragraph in it that says it all for me: 'Please do not be mad at what has happened. I did what I had to do and serving the British Army was it. Again, don't be sad.'
He adds: "'Celebrate my life because I love you and I will see you all again."
Mrs Downes said: "I just want everyone to know that we think our son died a hero, because he was."
Her son leaves a brother, two sisters, a stepbrother, a stepsister and his girlfriend, Jane.
The Guardsman had already completed one tour in Iraq with the Inkerman Company of the Grenadier Guards in 2006.
His commanding officer, Lieutenant Colonel Carew Hatherley, said Guardsman Downes was a "resolute and steadfast friend to all who knew him".
