The Shia militia run by anti-American cleric Muqtada al-Sadr briefly seized total control of the southern Iraqi city of Amarah on Friday before the Iraqi army moved in to retake the city.

Twenty-five gunmen and police died in the gunbattles for control of the city of 750,000 people.

A masked gunman stands on a street as a building burns in the southern Iraqi town of Amarah, 320 kilometres southeast of Baghdad, after it was seized by the Mahdi Army, the Shia militia run by anti-American cleric Muqtada al-Sadr.
(AP Television/Associated Press)

Fighters from al-Sadr's Mahdi Army stormed three main police stations Friday morning and destroyed the buildings with explosives, residents said. The Mahdi Army held Amarah for several hours.

The militiamen later withdrew from their positions and lifted their siege under a truce brokered by an al-Sadr envoy as the Iraqi forces entered the city.

Since British troops left Amarah in August, residents say the militia, which is one of the country's largest unofficial armies, has been involved in a series of killings in the city. They include slayings of merchants suspected of selling alcohol and women alleged to have engaged in behaviour deemed immoral by the militia members.

"We see here a paradigm for when U.S. and coalition forces withdraw from an area," New York Times reporter John Burns told CBC News Friday from Baghdad.

"We could see down the line a serious threat to the Iraqi government."

Iraqi Prime Minister Nouri al-Maliki had dispatched an emergency security delegation that included top officials from his cabinet and representatives from the interior and defence ministries, Yassin Majid, the prime minister's media adviser, told the Associated Press.

Al-Sadr's representatives went to Amarah from the Shiite holy city of Najaf to the north.

Killing of rival militia member sparked fighting

Earlier, about 800 black-clad militiamen with Kalashnikov rifles and rocket-propelled grenade launchers were patrolling city streets Friday in commandeered police vehicles, eyewitnesses said.

Other fighters had set up roadblocks on routes into the city and sound trucks circulated telling residents to stay indoors.

Fighting broke out in Amarah on Thursday after the head of police intelligence in the surrounding province, a member of the rival Shia Badr Brigade militia, was killed by a roadside bomb, prompting his family to kidnap the teenage brother of the local head of the Madhi Army.

The Mahdi Army seized several police stations and clamped a curfew on the city in retaliation.

The events in the city highlight the threat of wider violence between rival Shia factions, who have entrenched themselves among the majority Shia population and are blamed for killings of rival Sunnis.

With files from the Associated Press