stant delay and inclination to do evil, we will categorically not allow ... militias," Allawi said at a news conference. "This is the final call for them to disarm."

Iraqi officials have threatened to "liberate" the mosque with a military offensive if al-Sadr and his forces don't leave and disarm.

Al-Sadr is wanted in connection with the 2003 killing of a rival cleric, Iraqi officials have said.

Meanwhile, sounds of intense fighting erupted Thursday outside the mosque.

CNN's Kianne Sadeq, who is inside the compound with other journalists at the invitation of al-Sadr's Mehdi militia, reported persistent sounds of mortars, gunfire and many explosions, and devastation to the streets, homes and businesses around the mosque compound.

Two of the mosque's minarets have been damaged in recent fighting, and al-Sadr loyalists said a clock in one of the towers caught fire, Sadeq reported. The mosque is one of the holiest shrines in Shiite Islam.

"Everything outside of the mosque seems to be totaled," Sadeq said.

Allawi calls on cleric to speak

Allawi welcomed Wednesday's written statement by al-Sadr indicating the renegade Shiite cleric was willing to give in to demands.

Allawi said authorities "have not heard directly from al-Sadr himself."

When "we hear from him," the interim government will push ahead in developing a truce and seeing that the demands are carried out, he said.

"We left the doors open," Allawi said. "He must abide by the resolution of National Conference" -- laying down arms, dismantling militias and leaving holy shrines.

"We have no other agenda," said Allawi, who added later that he hopes the cleric will adhere "to the rule of law."

Allawi said that if al-Sadr wishes to become a leader in Iraq, he should partake in the political process and run as a candidate in the January election for a transitional national assembly.

An al-Sadr spokesman said Thursday the cleric had not agreed to negotiate with the Iraqi interim government, but only with the Iraqi National Conference.

The 1,000-member conference met this week to choose a 100-person interim body that will advise and oversee the newly installed Iraqi interim government.

Reports of fighting

Arabic-language television news networks were reporting pitched battles in Najaf.

Al-Arabiya reported that U.S. troops were attacking from three different locations. The fiercest battle was coming from what is known as the "Najaf Sea," or Abu al-Kheir Street, about 1,000 meters (1,093 feet) behind the Imam Ali shrine, the network said.

Al-Jazeera, talking to sources on the phone, reported that U.S. planes were targeting the Doha Hotel and fighting around the holy sites.

Elsewhere in Najaf, police and a Health Ministry official said four Iraqis were killed and 14 wounded when three mortar rounds hit a recruitment center inside the main police compound.

Inside the mosque

Journalists inside the mosque were led there with the help of the Najaf governor, and had to pass through a cordon of U.S. tanks surrounding the outskirts of the mosque and then through defense positions of the Mehdi militia.

The Mehdi militia welcomed journalists with dancing and cheering.

"They are very proud to be here," Sadeq said. "They are not leaving."

Along with the fighters, al-Sadr spokesmen and a few women and children are in the compound.

Al-Sadr's people deny that al-Sadr is inside the mosque compound. However, he is thought to be in the Najaf area.

Interim Iraqi Minister of State Kasim Daoud said that if the cleric does not respond to the government demands in the next few hours, military action will be taken.

At a joint news conference with Najaf Gov. Adnan al-Zufri, Daoud outlined the Iraqi government's conditions for al-Sadr to disarm. He said Iraqi forces have special intelligence that will allow them to get al-Sadr without destroying the shrine.

Daoud called on al-Sadr and his militia to hand over all of their weapons, and he noted that the radical cleric will not be allowed to have his own court system.

Iraq needs only one military, one leader and one government, Daoud said.

Al-Sadr must also free any civilian hostages he is holding, the minister said.

Other developments

A mortar Thursday struck the roof of a building housing the office of John Negroponte, U.S. ambassador to Iraq, wounding two people, a U.S. Embassy spokesman said. Negroponte was not in the building at the time, said spokesman Bob Callahan. The building is in Baghdad's Green Zone, a compound of governmental headquarters.

Two Polish soldiers were killed and five injured when their vehicles crashed early Thursday as they were trying to escape an ambush in the central Iraqi city of Hillah, a military spokesman said. (Full story)

Armed militants Wednesday said they would kill a Western journalist who was kidnapped in Iraq if U.S. forces do not withdraw from Najaf within 48 hours. In a videotape aired on Al-Jazeera, journalist Micah Garen, 36, was surrounded by five armed, masked militants. Garen was kidnapped last Friday in the southern city of Nasiriya while working on a documentary on antiquities in Iraq. (Full story)

A U.S. soldier was killed Wednesday when a patrol was attacked in eastern Baghdad and a Marine died after a vehicle accident in western Iraq's Al Anbar province, the U.S. military said. The number of U.S. troops killed in the Iraq war stood at 951 as of Wednesday. Of those, 709 have died in hostile action and 242 from nonhostile activity, according to the U.S. military.

Two detainees were killed and five others were wounded Wednesday during a fight involving more than 200 prisoners at the Abu Ghraib prison on the outskirts of Baghdad, according to the coalition press office. A news release said "lethal force" was used after verbal warnings and "nonlethal rounds" failed to break up the brawl.

An Army report will recommend that approximately two dozen military intelligence personnel face possible disciplinary action in the Abu Ghraib abuse scandal, military sources said. The report, expected to be released as early as next week, will find that the abuse was not ordered by senior commanders as part of approved interrogation practices, the sources said. (Full story)

In Mosul, at least six Iraqis were killed and 21 others were wounded Wednesday when a missile struck the main commercial center, police said.

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