Shia cleric Moqtada Sadr on Friday threatened the US-led coalition with suicide attacks if it launched offensives on Iraq's holy cities, while his militiamen killed a Bulgarian soldier in an ambush.
Sadr said his supporters would "resort to suicide operations" in a Friday prayer sermon at almost the same time as his Mehdi army militia attacked a Bulgarian troop convoy in the holy city of Karbala and sparked a clash which left 10 people wounded, officials said.
In another sign of growing pressure on the coalition, a prominent Sunni leader in Baghdad, Sheikh Ahmad Abdel Ghafur Samarrai, warned the occupation could spark a national uprising if US forces resume their offensive on the flash-point city of Fallujah.
Amid the worst violence since last year's invasion, the US administrator for Iraq Paul Bremer went on television Friday to try to rally the country behind US plans for its future.
He announced the disbanded army of former dictator Saddam Hussein would be largely reformed to counter the country's security crisis amid coalition disquiet over the performance of new US-trained security forces.
"The (interim) minister of defence informs me that he intends to have a meeting with vetted senior officers from the former regime next week to discuss how best to build the new Iraqi military establishment," Bremer said.
"More of these officers with honourable records - from the former army and elsewhere - will serve in the months ahead as your new army grows," said Bremer.
But Sadr, who the coalition has promised to capture or kill over the murder of a pro-US rival cleric last year, ramped up the threat against the coalition Friday even as US-led soldiers massed outside the holy city of Najaf where he has been holed up for the last two weeks.
"If we are forced to defend our cities, we will resort to suicide operations and we will be human time-bombs, which would explode in their faces," he said.
He said there were enough people prepared to carry them out. "Until now we had refused to do this," he said. "But if we are forced to do it, we will," he said in Kufa, just outside Najaf.
Brigadier General Mark Kimmitt, the coalition's deputy director of military operations, said Friday the US-led coalition would "respect all religious structures" in their attempt to bring Sadr before a judge.
"We have all the time in the world if he wants to hole up inside that city," he told CNN.
The Bulgarian soldier was fatally wounded in the ambush at about 12:10 pm (0810 GMT) near the Karbala city hall, while an Iranian pilgrim, four civilians and five militiamen were injured in the fighting which lasted about 30 minutes, witnesses and hospital staff said.
The city hall in Karbala, 110 kilometre's (65 miles) south of Baghdad, is near the office of a Sadr religious foundation and the al-Mokhayam mosque controlled by Sadr loyalists.
Iraqi mediators and hospital officials previously said that between 600 and 700 people died in Fallujah. Scores of US troops were also killed.
But the death toll from Wednesday's co-ordinated series of five suicide bombings in and around the British-controlled southern city of Basra rose on Friday to 74 dead with more than 160 wounded.