Iraqis loyal to a radical Shia Muslim cleric have occupied the governor's office in Basra in protest at coalition actions against their movement.
About 150 followers of Moqtada Sadr took over the building unopposed to stage what they called a sit-in.
Sunday saw clashes across Iraq between gunmen loyal to Mr Sadr and coalition forces, with dozens killed or injured.
Elsewhere, US troops have sealed off the Sunni town of Falluja where four Americans were killed last week.
Mr Sadr is an increasingly outspoken opponent of the US-led occupation and the coalition recently arrested one of his top aides, Sheikh Yakubi, and closed down a newspaper accused of inciting anti-US violence.
Many of Iraq's majority Shia Muslims, repressed under Saddam Hussein, welcomed last year's US-led invasion and attacks on coalition forces were largely confined to the minority Sunni community before Sunday's violence.
Talks Under Way
Dozens of militants belonging to Moqtada Sadr's Mehdi Army moved into the governor's office in Basra at dawn on Monday chanting "No to America, we'll sacrifice ourselves to Sadr" and waving pictures of their leader, the BBC's Dumeetha Luthra reports from the roof of the building.
Reuters news agency reports that the governor, Wael Abdul Latif, fled the building earlier.
Monday's protests come after a day of bloody violence between Mr Sadr's followers and coalition forces in Shia areas of the country:
Seven US soldiers were killed in the Sadr City area of Baghdad as they battled to regain control of buildings occupied by the Mehdi Army. Unconfirmed reports say at least 22 Iraqis also died and many were wounded on both sides
A protest march on a Spanish coalition base near the holy city of Najaf ended in violence in which a coalition soldier from El Salvador and one from the US were killed along with about 20 Iraqis. Many more were injured.
Four Iraqis were killed and eight wounded in clashes between UK forces and Mehdi Army militiamen in the south-eastern city of Amara, according to hospital sources.
'Civil War'
The US administrator in Iraq, Paul Bremer, said the protesters in Najaf had "crossed the line" and violence would not be tolerated.
Two senior US congressmen have warned President George W Bush's administration that Iraq faces the possibility of civil war.
The Republican and Democratic Party leaders of the Senate Foreign Relations Committee, Richard Lugar and Joe Biden, said the US should consider postponing the handing over of sovereignty on 30 June.
www.matamat.com/fullstory.php?gd=32&cd=2004-04-06E-mail this article