Deputy Secretary of State Richard Armitage told a US radio station on Tuesday the makeup of the Council might be changed, but power would be handed over to it.
Currently, the 25 seats are allocated according to Iraq’s ethnic and sectarian make-up.
The Bush administration has said it is going to hand over power by 1 July.
Under pressure from the Shia Washington has scrapped its idea for caucuses to elect a government and has left open other alternatives for creating an administration. An expanded version of the IGC seems to be the most seriously considered option.
Under the direction of leading Ayat Allah Ali Al-Sistani the Shia also dropped demands for direct elections by 30 June after a United Nations fact-finding mission said the country was not prepared for such a vote.
US officials are increasingly hinting that there will be a delay in the handover.
Defence Secretary Donald Rumsfeld said he could not be sure if the deadline would be met.
“Do I think it will happen? It has a chance of happening, yes. Will it happen for sure? Who knows?”he said.
On the ground, an alleged female assailant armed with an AK-47 rifle was wounded by Iraqi security guards as she tried to enter a guarded ammunition supply point, said US occupation authorities on Wednesday.
The woman was taken to hospital while a second woman was detained and held for questioning over the incident in Ramadi, 100km west of Baghdad on Tuesday, said occupation officials in a statement.
Separately, a unit of US paratroopers escaped unhurt after being attacked with a homemade bomb in the same area on Tuesday.
But as they secured the scene, the soldiers discovered the corpse of a woman about 300 metres away. Iraqi police are investigating the incident.