BAGHDAD (AFP) — The US military, which has deployed thousands of extra troops in the Iraqi capital to try to stem rampant violence, said the operation was aimed at Shiite extremists and the houses destroyed were "enemy strongholds."

Iraqi defence and interior ministry officials said US helicopters fired on houses in the Al-Washash neighbourhood of Mansour district in west Baghdad between 2:00 am (2200 GMT Wednesday) and 3:00 am.

Abu Ali Saad, a resident of the mainly Shiite enclave, said US military vehicles had arrived in large numbers in Al-Washash during the night.

"There were tanks and armoured vehicles and many troops," 35-year-old Saad told AFP while surveying the rubble of his neighbour's home.

"The tanks started firing, then the helicopters came. Missiles were fired from the air. Houses were destroyed. A family of five was killed in this house," he said, referring to his neighbours.

"We are a peaceful neighbourhood. There are no militia here. There were no exchanges of fire. We were all sleeping."

The US military said Iraqi and US forces had engaged Shiite extremists who were part of a "terrorist cell" operating in Al-Washash.

When the forces entered the area, they came under fire from "more than a dozen extremists firing from the rooftops of surrounding buildings," a statement said.

The fire was returned and air strikes were carried out against "positively identified armed gunmen directing small arms fire onto the assault force".

"A total of four buildings were damaged, including two enemy strongholds that sustained major damage and two surrounding buildings that sustained moderate damage."

A later US military statement suggested that the targets of the operation in Al-Washash were dissident elements of the Mahdi Army militia of radical Shiite cleric Moqtada al-Sadr.

It said that while "many honourable" Mahdi Army members were heeding a call by Sadr last week to halt their militia activities, others were ignoring it.

These groups, it warned, "will not be subject to the restraint we have observed for those who are responding to Sadr's orders."

An AFP photographer on the scene said three houses were destroyed and two damaged.

Amid the rubble of one house was a mattress covered in blood with body parts scattered about. Neighbours said a family of six had been killed in the house, including a 12-year-old girl.

Bloodstains could be seen amid the wreckage of other houses, where angry residents gathered to denounce the US military.

Washington has deployed an extra 28,500 troops as part of a "surge" in Baghdad and surrounding areas aimed at quelling sectarian violence that has killed thousands of Iraqis since it erupted 18 months ago.

The latest killings come just days before the White House is to make a formal report to the Democratic-controlled Congress aimed at persuading lawmakers to continue funding the Iraq war.

In other violence, a bomb exploded near a queue of day labourers in Baghdad's southeastern Zafaraniya district, killing one and wounding five, a defence ministry official said.

In executed dictator Saddam Hussein's hometown of Tikrit, a car bomb aimed at a police patrol killed two civilians and wounded 17, police said.

In Hawra Haajab village on the southern outskirts of Baghdad, US troops killed two suspected Al-Qaeda militants and captured at least two more, said Captain Chad Klascius, who was leading the assault launched early Thursday.

"We've moved into the town and are taking it back. We are trying to push Al-Qaeda out," Klascius told AFP. "We are shooting machine guns and they are returning fire as well as shooting mortar rounds.

"We have killed two Al-Qaeda and have around 30 detainees, two of whom have confessed to being Al-Qaeda," the captain said.