In Nasiriyah former Iraqi troops frustrated with the process the occupation administration had set up to pay their salaries demonstrated angrily, reported Aljazeera's correspondent.
The ex-soldiers clashed with Italian forces, who fired tear gas to disperse the protesters.
Some demonstrators said they had not received their wages for several months.
Similar demonstrations elsewhere turned bloody.
One Iraqi was killed and two dozen were hurt at a demonstration in Baghdad, AFP reported.
The US military said two of its soldiers were wounded in the exchange of fire between its troops and former Iraqi soldiers.
Another Iraqi died in the main southern city of Basra, when occupation forces opened fire during a similar protest over late pay, a British military spokesman and witnesses said.
And there was a similar protest by former servicemen waiting for back pay in the central city of Hilla.
A US military spokesman, Lieutenant Colonel George Krivo, blamed the incidents in Hilla and elsewhere on supporters of toppled President Saddam Hussein.
Krivo said his supporters had spread rumours the former soldiers would not be paid.
US soldier killed
The toll among US forces rose when a soldier from the 4th Infantry Division was killed and another wounded in a rocket-propelled grenade and small-arms attack in Baghdad late on Friday, the US military said.
US troops push back protesters in
in Baghdad after killing one Iraqi
The casualty brought to 90 the number of Americans killed in action in Iraq since 1 May, when Washington declared major fighting over.
A row between two European countries - one a participant in the US-led forces and the other a key opponent of the occupation – continued to rumble over the issue of weapons sent to Iraq.
Polish troops (front) are trying
to pacify part of central Iraq
But Poland said on Saturday the diplomatic controversy - sparked by an allegation that its troops in Iraq had found Franco-German missiles made this year -had been resolved, after receiving a strong rebuke from France.
The French president had earlier brushed off the claim by the Polish defence ministry that a Polish patrol had found four Roland anti-aircraft missiles south of Baghdad, apparently manufactured this year.
“There cannot be any missiles there in 2003 because the missiles haven't been built for the past 15 years,” Chirac retorted at an EU summit in Rome.
Chirac said Polish soldiers must "have been confused" about the find, which would have violated a UN weapons embargo against the former Iraqi leader Saddam Hussein.
Chirac added the Poles should have checked their find more carefully before making the allegations.