A delegation from Falluja cut off negotiations late on Thursday to protest against threats by interim Prime Minister Iyad Allawi to invade the city if residents did not surrender foreign fighters.
"We were taken aback by Allawi's comments since there was no mention of al-Zarqawi during the talks," said one of the delegates, who gave his name as Abu Ahmad.
On Wednesday, Allawi demanded Falluja turn over al-Zarqawi, which US military authorities say is the most wanted man in Iraq, or face a military invasion.
Before Allawi made his demand, delegate Shaikh Khalid Hamud had been saying that, after weeks of talks, they were close to mediating a solution between some elements of the anti-US fighters in the city and the interim government that would allow the return of Iraqi forces.
Falluja representatives said they had no evidence that al-Zarqawi was in the city and voiced dismay at Allawi's ultimatum.
US planes have frequently pounded targets in Falluja that the military says are used by followers of al-Zarqawi.
US air strike
Plumes of smoke rose from the city's Hay al-Julan quarter after the mid-afternoon air strikes on Thursday. Reuters Television footage showed at least one building reduced to rubble.
Falluja residents say there is no
evidence al-Zarqawi is in the city
US warplanes also bombed al-Jubail neighbourhood in the city, sources told Aljazeera.
"The first raid targeted a vacant house in al-Julan neighbourhood, northwest of Falluja, completely demolishing it and damaging two nearby houses," Iraqi journalist Abu Bakr al-Dulaimi told Aljazeera.
"However, most houses in this area are vacant as their residents have fled them," he added. "The second raid targeted a house in al-Jubail neighbourhood, southeast of the city."
The Iraqi journalist added that the hospital had received the body of an elderly man. "The injured are children and young men," he said.