Iran
Iran was able to keep moral up in the early parts of the war as Iraq was seen as an evil aggressor bent on the destruction of the newly created Islamic Republic. This can be seen in the huge number of volunteers which grew the Iranian army in the initial stages of the war. While human wave tactics crippled moral during World War I, the Pasdarans and Basij were borderline fanatical and were used in some areas to clear anti-tank mines. It was only with huge Iraqi strategic successes and attacks on Iranian civilians that support dwindled. Even then, children would sometimes join the Pasdaran as defenders of the revolution.
While woman did not play a large role in the Iranian armed forces, they were encouraged to contribute none-the-less. With so many men occupied fighting the war, women were also key in efforts to collect food and blood for the war effort. To help increase production, the Iranian government organized the Reconstruction Campaign to take those who were unable to fight and enable them to contribute to the war through increasing factory production and rebuilding of key Iranian infrastructure. Iranian propaganda included many posters which called on all Iranians to make sacrifices for the greater struggle.
As a whole it was much easier for Iran to mobilize its economy and population than Iraq. At the onset of the war the Iranian economy was about three times the size of Iraq's with three times the population. At the same time Iranian civilians were often the victims of unprovoked chemical weapon attacks which came with almost no warning. As part of the total war, civilians were seen as open targets and Saddam Hussein had no qualms with killing Iranian civilians in an attempt to drive Ayatollah Khomeini to the bargaining table.
Iraq
In order to maintain support for the war Saddam Hussein attempted to protect the Iraqi civilians from any harm. While there were Iranian missiles that struck Iraqi civilian centers, these did minimal damage and had relatively small impact on the moral of the Iraqi civilians. Knowing that the Kurds and Shia in Iraq were going to pose problems during the war, Saddam tried to placate them by allowing Shia Muslims into the Ba'ath party and making early concessions to the Kurdish parties in Iraq. Despite these better intentions at the onset of the war, opinion and policy quickly turned after the Iranian invasion of Iraq and persecution of Shia Muslims increased such as the Dujail Massacre after an attempted assassination of Saddam. The autocratic nature of the Ba'ath Party enabled Saddam to have mandatory blood drives and use the civilian labor force to help clear areas for military defenses.
Part of the movie, "Alhodood Almultahebah" (The Flamed Borders) made in Iraq in 1987
A key part of the propaganda in Iraq was maintaining the cult of personality around Saddam Hussein as a strong military leader. He wished to maintain this but it was requested in the later parts of the war that he delegate more responsibility to those below him due to his controlling nature. Also used as propaganda was captured Iranian equipment such as Iranian tanks which were displayed in Baghdad.