KARBALA/NAJAF, May 14: At least 10 people were killed on Friday in fierce clashes between United States troops and Mehdi Army in Najaf and Karbala, as Moqtada Sadr remained defiant and urged his followers to fight on.

The US military said its forces were attacked with grenades, gunfire and mortars by Sadr's Mehdi Army, sparking a six-hour battle that damaged the golden dome of Hazrat Ali's (RA) shrine.

Despite the fighting, Sadr still conducted Friday prayers in Kufa and vowed to continue his struggle against the US-led occupation.

He told his supporters that "the spilling of your blood in this blessed land is the beginning of your victory".

Mr Sadr told rival Shia groups not to side with the US-led forces against him and he criticized the Shia religious authority for keeping quiet.

The fighting on Friday started at 8:40 am (0440 GMT) when mortar rounds were fired at the Iraqi police headquarters in the city and developed into a series of running battles between the two sides.

US tanks moved across the city's vast cemetery about a kilometre northwest of the Hazrat Ali (RA) shrine.

Black-clad militiamen loyal to Sadr fanned out across the area, which was covered with thick black smoke and circled by US helicopters.

US troops also came under fire from a mortar position that was destroyed by ground troops, the coalition's deputy director of operations, Brigadier General Mark Kimmitt, told a Baghdad briefing.

Gunfire and loud explosions were also heard from an area south of Najaf known as Bahr al-Najaf, where about 2,500 US soldiers are camped in the desert.

"The Mehdi Army has 10 martyrs," said Sadr spokesman Sheikh Ahmed Shibani. "We are ready to confront any American force whatever its size," he said as hundreds of armed men chanted Sadr's name nearby.

Fresh explosions and gunfire were heard again at around 7:00pm (1500 GMT) following a five-hour lull in fighting which saw some residents venture out of their homes to shop.

The fighting left three holes in the dome of Hazrat Ali's (RA) shrine as the two sides blamed each other for the damage.

A Sadr spokesman described the shooting as the "worst of crimes" but the US blamed Sadr's Mehdi Army for bunkering down around the shrine and said his militiamen were more likely to have caused the damage.

"I would put my money on Moqtada's forces having caused it," said Kimmitt.

"It's important to understand we haven't attacked the shrine of Hazrat Ali. We continue to respect the red lines" established by the Shia religious leadership."It is sad there have been attempts by groups to use the red line to hide behind to kill Iraqi police and to kill coalition forces."

Grand Ayatollah Ali Sistani, the most prominent figure in the Shia hierarchy, has steered clear of endorsing Sadr but has called for Najaf's sanctity to be respected.

The fighting came after the newly appointed Najaf governor, Adnan al-Zorfi, told AFP late on Thursday that a "US entry into the centre of Najaf may be imminent."

He said a lot of Sadr's followers were "simple men who did not fathom the military might of the United States."

In Nasiriyah, Militiamen loyal to Moqtada Sadr attacked a police station in the Italian-patrolled city of Nasiriyah on Friday, freeing 16 detainees, police said.

A hotel in the centre of Najaf, occupied by foreign and Iraqi reporters, was damaged in intense fighting on Friday.-Agencies