US tanks are still positioned at the Thawrat al-Aishrin square, less than two kilometres away from Najaf's city centre, reported Aljazeera's correspondent on Tuesday.
Earlier, mortars had slammed into the square where US occupation forces continue to face fierce resistance from members of Shia leader Muqtada al-Sadr's al-Mahdi Army militia.
A mortar bomb was also fired at the entrance of a hotel in the area where journalists are staying. There were no injuries.
The golden dome of Imam Ali's mosque, the most revered and historic Shia sanctuary, has also had four holes blown through it.
Otherwise, bitter fighting continued in the holy city of Karbala, which came under control last month of al-Mahdi militiamen.
Members of al-Mahdi army are
fighting against the occupation
One Iraqi was killed and five injured in the fighting between al-Mahdi fighters and US occupation forces, said medical sources at Karbala Hospital. But witnesses said nine fighters were killed and others injured in the fighting on Tuesday.
Earlier, US military officials said at least 30 members of al-Mahdi army were killed during clashes overnight, but a medical source told Aljazeera only nine had been killed and another 30 injured.
Most of the fighting took place close to al-Mukhayam mosque near Imam Husayn shrine, one of the most revered spots for Shia Muslims in the world.
Shooting continued to reverberate around the city on Tuesday. Citizens of Karbala said US Apache helicopters bombed the city, but occupation troops denied this, saying surveillance helicopters were in the area.
Iraq's leading Shia cleric Grand Ayat Allah al-Sistani called on Tuesday on US forces and Shia fighters to withdraw from Karbala and Najaf.
The Iranian-born cleric called for the return of Iraqi police and tribes to take control of the security situation.
Elsewhere, two US citizens were killed and a third was injured when armed men opened fire on a car in Mosul city, Aljazeera's correspondent in Iraq reported. The identity of those killed is still unclear.
Izz al-Din Salim was killed on
Monday outside the Green Zone
A US patrol evacuated the casualties. A British working as a contractor in Iraq was shot dead by a gunman in Baghdad on Friday, Britain's Foreign Office revealed on Tuesday.
And two US occupation soldiers were killed in al-Anbar province on Monday, said military officials on Tuesday. Their deaths took the overall toll of US soldiers in Iraq to 785 since the start of the US-led invasion in March last year.
IGC leader buried
In other developments, the president of the US-appointed Iraq Governing Council (IGC) was buried on Tuesday after being killed a day earlier.
Izz al-Din Salim's funeral was held within the so-called Green Zone, where the US occupation authority maintains its headquarters in Baghdad.
Salim's body was to be taken to his home city of Basra, in the south, before making the journey to Najaf for burial.
Salim was killed in a bomb blast outside the gates of the Green Zone.