American troops were involved in prolonged street fighting after launching one of the biggest military offensives since last year's assault on Fallujah.
United States warplanes dropped 226kg bombs and helicopter gunships strafed the town of Husaybah near the Syrian border.
Dozens of insurgents were killed in the fighting, American commanders claimed, without their forces suffering any deaths.
However, there were reports of large numbers of civilian casualties, and a prominent Sunni leader accused the US and the Iraqi Government of carrying out a deliberate "killing operation".
More than 3500 American and Iraqi forces are engaged in Operation Steel Curtain in the western province of Anbar, where Abu Musab al-Zarqawi's al Qaeda in Iraq group are said to have bases and supply lines into Syria.
Two previous large-scale offensives had failed to stop attacks by insurgents in the area and yesterday large parts of Husaybah were empty, after many of its 30,000 residents had left.
But US and Iraqi troops came under sustained fire from insurgents using Kalashnikov rifles, machineguns and rocket-propelled grenades and only a small part of the town had been secured by nightfall.
Captain Conlon Carabine, of the 6th Marine Regiment, said, "We met more resistance than we expected. I thought they were planning more on a defensive posture."
Another officer, Colonel Stephen Davis, while ordering Abrams tanks to fire, added: "I got bombs, he got bombs. I got more bombs than he got. It's a very primal fight. We don't do a lot of hearts and minds out here because it is irrelevant."
American officers said air strikes were called in to destroy suicide car bombs heading for their forces and searches had revealed hidden caches of arms, landmines and explosives.
Saleh al-Mutlaq, who heads the Council for Dialogue, an umbrella group for various political, religious and tribal organisations, scathingly criticised the military action and warned of serious repercussions.
"American forces accompanied by what is called the Iraqi Army and national guard are conducting a destructive and killing operation of secure cities and villages on the pretext that they hide terrorists."
US officials said the operation was being carried out to try to establish security in the Anbar region and block insurgents from crossing over from Syria.
Husaybah is claimed to be one of the main staging posts for foreign jihadists who enter Iraq through a series of desert towns along the Euphrates River.
US commanders said they would go through about 4000 buildings in the town and surrounding areas, but many are suspected of being booby trapped.
- INDEPENDENT
US launches offensive on Fallujah insurgent base
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