Citing intelligence reports, the unnamed officials said some agents were members of the Badr Brigade, the military wing of an Iraqi exile group operating from Iran, and irregular members of a special unit of Iran's Revolutionary Guards.

"They are not looking to promote a democratic agenda," one military official said.

The Shiite Muslim pilgrimage to the holy city of Karbala, 80 kilometersmiles) to the south of Baghdad, provided cover for the Iranian agents, the officials said, adding that members of the Badr Brigade have been seen to "shed their uniforms, put on civilian clothes, and disappear."

US troops have been trying to monitor the Iraq-Iran border to prevent infiltrations, but the border is too long and porous to secure, the officials said.

They said the US government was concerned that Iran may be trying to take a more assertive role in shaping developments in southern Iraq, where the population is predominantly Shiite Muslim like that of Iran.

In main concern, the US officials added, is that Tehran may be seeking to promote an Iranian model of government.

The US government has underestimated the organizational strength of the Shiites in southern Iraq, and is now concerned that their aspirations could coalesce into a fundamentalist government, The Washington Post said Wednesday also quoting US officials.

"It is a complex equation, and the US government is ill-equipped to figure out how this is going to shake out," a State Department official said. "I don't think anyone took a step backward and asked, 'What are we looking for?' The focus was on the overthrow of Saddam Hussein."

The majority Shiite population in Iraq was oppressed for years under the dictatorship of Saddam Hussein. After the 1991 Gulf War, the US-led coalition, it is believed, did not try to overthrow Saddam for fear that a Shiite-led Islamic goverment would take his place.

A spokesman of the Supreme Council for Islamic Revolution in Iraq, a Tehran-based Iraqi Shiite exile group, told The New York Times in a telephone interview from London that his group would not send an emissary to the next meeting in Baghdad Saturday to seek the formation of an interim government.

"If they are talking about democracy, they should leave the Iraqi people to organize themselves," Bayati told the daily.

SPACE.WIRE