Citing unidentified Pentagon and Iraqi sources, the magazine reported on Sunday that the US is using "back-channel" communications with certain groups.

The Bush administration has said it will not negotiate with Iraqi fighters and there is no official authorised dialogue.

The magazine cited a secret meeting between two members of the US military and an Iraqi negotiator, a middle-aged former member of Saddam Hussein's government and the senior representative of what he called the nationalist insurgency.

A US officer tried to get names of other leaders while the Iraqi complained the new Shia-dominated government was being controlled by Iran, according to an account of the meeting provided by the Iraqi negotiator.

"We are ready to work with you," the Iraqi negotiator said, according to Time.

Open to negotiation

US troops have struggled against
anti-US fighters across Iraq

Leaders of anti-US Iraqi groups told the weekly several nationalist groups composed of what the Pentagon calls "former regime elements" have become open to negotiating.

Their aim was to establish a political identity that can represent disenfranchised Iraqis.

The White House had no immediate comment on the report. 

When asked about the contacts, Republican Senator Chuck Hagel of Nebraska, a member of both the Senate Foreign Relations and Intelligence committees, said it was important to "reach out" in Iraq.

"We've got a very complicated and dangerous situation over there and you are going to have to reach out, you are going to have to develop some relationships and networks," he said on CNN's Late Edition.