US troops had engaged Republican Guard units of Medina, Nebuchadnezzar and Baghdad around Karbala, 80km south of the capital. The Adnan division was being attacked from the air from the north.

US troops were supported by wave after wave of air attacks and repeated firing from rocket launchers, reports reaching Dubai said.

On the other side of the Euphrates River, a second US column was progressing, while to the east, US marines claimed they have seized a key bridge across the River Tigris at the city of Kut, allowing them to take control of one of the main highways north towards Baghdad.

The Medina division around Karbala and the Baghdad division around Kut are among the main military forces resisting the US advance towards the capital.

In his second message in as many days to his countrymen read over state-run Iraq television, Saddam Hussein said that only a third of Iraq's armed forces have engaged in battle with US-led forces so far.

"Fight them. Victory, thank God, is at hand. We have only deployed a third of our army or even less than a third," Saddam, who on Tuesday called for a holy war against US-led invading forces, said in the message read by a news anchor in military uniform.

The capital Baghdad itself continued to come under bombardment with at least six explosions reported before dawn.

There is no sign yet of the advance, but residents are fully aware that US troops are trying to encircle the city, a BBC correspondent reported from Baghdad.

Iraqi officials said American Apache helicopters attacked a neighbourhood in the central Iraqi city of Hilla on Tuesday, killing 33 people and injuring more than 300. The US Central Command in Doha said it was investigating the claim.

In Washington, officials claimed that the US air and artillery assault over the past few days had greatly reduced the strength of Saddam's elite troops, but there has been no independent verification of these claims.

Pentagon officials said the Republican Guard units must be eliminated before US ground troops enter the capital.

Following Tuesday night's attack on the Republican Guard based in Karbala, the 3rd Infantry Division is now pushing towards the city, the BBC reported.

US troops found 11 unidentified bodies while rescuing a colleague Jessica Lynch, 19, who was taken prisoner by Iraqi forces, an American officer said.

Lynch, Army Private First Class, was rescued during a  raid in an Iraqi hospital in the southern town of Nasiriyah.

Increasing numbers of US troops are now arriving in the Gulf to provide back up to those units pushing ahead.

Some 5,000 troops from the US 4th Infantry Division are now waiting in Kuwait but it could still be weeks before they enter Iraq, according to the division's assistant commander Brigadier General Stephen Speakes.

PTI