US fighter jets and military helicopters hovered above the area where the battle was centred, witnesses and the US military said.
Skirmishes began in the early hours of Tuesday and by daylight had grown into a heated exchange of fire, forcing residents to avoid main roads.
The US military said Iraqi soldiers with support from US-led forces "are conducting targeted raids to capture multiple targets, disrupt insurgent activity and restore Iraqi security forces' control of north Haifa Street".
|Pakistanis torch a US flag in Peshawar in |
protests gainst the execution of Saddam [AFP]
In a separate statement, the Iraqi defence ministry said its forces had arrested 11 people, including seven Syrians from Haifa Street.
The statement did not clarify when the arrests were made.
It said two of the four other men arrested were al-Qaeda members picked up from Yusufiya, south of Baghdad.
The ministry added that eight hostages were also set free in Haifa Street.
The latest bout of fighting came as a new video showing the body of Saddam Hussein, the ousted president, shortly after his hanging appeared on the internet on Tuesday.
"They could have used this as their ticket to a new life, instead they use their freedom to slaughter each other"
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The footage shows his head sharply twisted to one side and a gaping bloody wound to his neck.
The 27-second footage, apparently taken with a mobile phone camera, is expected to trigger fresh outrage over the manner in which the former president was hanged and his body treated immediately after the execution.
The footage begins by showing a body on a stretcher covered in a white shroud and the camera moving upwards.
As the camera reaches the head, the shroud is pulled aside to reveal the bearded face of Saddam twisted sharply to his right with a wound just below his jaw on the left side.
A few red blotches are also seen on Saddam's left cheek.
Voices can be heard, apparently of those shooting the film secretly.
As the shroud is pulled back one voice is heard saying, "Hurry up, hurry up. I will count one to four."
Then another voice is heard saying: "Abu Ali, you take care of this."
The latest video follows an earlier one posted on the onternet soon after the December 30 hanging, also shot secretly on a phone camera, which showed Saddam at the gallows being taunted by guards moments before the trap-door opens.
In another development, a group of Iraqi pilgrims were missing after being taken to an unknown destination by security forces.
"We hold the Iraqi government completely responsible for the safety of the pilgrims"
Alaa Makki, a member of the Iraqi parliament from the Iraqi Accord Front and a member of the Iraqi Islamic party's political bureau, told Al Jazeera he had received phone calls from people returning from Hajj who told him that the pilgims were seized on their way back to the country.
"When pilgrims arrived in Arar city [on the Iraqi-Saudi borders], the security forces dragged away four wanted Islamic scholars and drove the rest to an unknown place," Makki quoted the pilgrims as saying.
The four scholars were Sheikh Khalid Abdul Razzaq al-Dosari, head of a convoy, Sheikh Iyad Ahmad al-Juburi, a mosque imam and a preacher, Sheikh Saeed Rasheed al-Azzawi and Sheikh Ahmed Abbas Muhammad, he said.
"Some pilgrims phoned us and asked for our help before the police forced them to hang up," Makki explained.
"We hold the Iraqi government completely responsible for the safety of the pilgrims," he said, adding that the pilgrims were Sunnis who came from al-Amiriya city.