About 2000 Arab and Turkmen protestors marched on the headquarters of the Patriotic Union of Kurdistan(PUK), one of the two main Kurdish factions, to demonstrate against a push by the city's Kurdish majority to incorporate the oil-rich centre into an autonomous Kurdish province.
Protestors surrounded the building, chanting "No to federalism, Kirkuk is Iraqi" when clashes erupted.
Police said Kurdish fighters known as peshmergas opened fire on the demonstrators.
Two people died on arrival at Kirkuk General Hospital, while a third died later of his wounds, hospital director Hashim Muhammad told AFP. Other sources quote another two died. Further details are not yet known.
A total of 31 people were wounded, five of them seriously, Muhammad said, adding doctors were operationg on the most serious casualties who were wounded in the head, abdomen and heart.
Peshmerga guarding the PUK headquarters told Aljazeera's correspondent that the protesters had weapons and they were shooting at them (guards).
However, protesters denied the allegations, saying they did not have any arms. "The peshmerga opened fire at the protesters," they told the correspondent.
Witnesses said US tanks and armoured vehicles quickly moved in to seal off the area, fanning out near the PUK offices and a local government building to keep protestors at bay.
Representatives of Iraqi Shia leader Muqtada al-Sadr, backing the Turkmen, were present at the rally.
Many chanted "Kirkuk, Kirkuk is an Iraqi city. No to federalism" and "We want the Kurds to leave Kirkuk".
Police chief Shirku Shakir Hakim said he told the demonstrators to stay on the edge of the town to avoid clashes with Kirkuk's Kurds.
"Kirkuk, Kirkuk is an Iraqi city. No to federalism"
The Arabs appeared to hail mainly from outlying towns around
Kirkuk, 255 kms north of Baghdad. Despite guerrilla attacks, Kirkuk, a volatile mix of Kurdish, Arab and Turkmen, has avoided serious confrontation, thanks to a city council representing all of the city's communities, with a Kurdish mayor and Arab deputy.
"They are coming to protest from Hawija, Tarjil and Tuz Kharmatu more than from Kirkuk," said Police Colonel Burhan Tayyib Habib, speaking about outlying areas which the Kurds want to incorporate into a Kurdish federalist zone.
In a separate incident, an Iraqi policeman was killed and 30 others wounded when unidentified assailants opened fire at them. No further details, according to the Aljazeera correspondent, are available.
Last week, thousands of Kurds took to the streets of Kirkuk to lay claim to the major oil centre where the old Baath regime settled large numbers of Arabs from the 1970s.
Kurds demand oil-rich Kirkuk
Kurdish leaders Jalal Talabani and Massud Barzani are pushing Iraq's Governing Council to recognise their vision of a federalist state, well before the approval on 1 March next year of a Basic Law to govern Iraq during the transition period through 2005.
Draft legislation they had submitted would grant Kurds near
autonomy in the three formerly rebel-held provinces of Arbil, Dohuk and Sulaymaniyah, as well as Tamim province around Kirkuk, and Kurdish areas of Nineveh and Diyala provinces.
Iraqis killed in Baghdadd
Also on Wednesday, an Iraqi child was killed in Baghdad when a parked car exploded as a US military convoy passed.
"A child was killed in the explosion of a parked white Toyota on Palestine Avenue," in the centre of Baghdad, said Jasim Jabbar, of the Iraqi Civil Defence Force. No US soldiers were hurt.
US soldiers on alert amid New
Year's Eve attacks fears
Earlier on Wednesday, the US military comfirmed that two Iraqis were killed in an ambush south of Baghdad on Monday, in an attack on a British and Iraqi convoy.
"A group of Iraqis and British personnel were attacked with small arms fire near Mahmudiyah. The engagement resulted in two friendly Iraqis being killed and two wounded," the US military said in a statement on Wednesday.
On Monday, an official said two Iraqis were believed killed and a Briton might have been wounded in the attack in the small town of Mahmudiyah, lying just south of Baghdad.
Elsewhere, the 82nd Airborne Division said three paratroopers
were wounded on Monday in a firefight near Habbaniyah, 60 kms west of Baghdad, when they were ambushed by 10 armed fighters. Two soldiers were taken to hospital and one was returned to duty, the 82nd Airborne Division said.