The move, likely to provoke an outcry from China and other nations who suffered from Japan's war-time aggression, came as Tokyo is preparing to send military personnel to Iraq despite fierce opposition at home.

Dressed formally in hakama pleated skirt and traditional "kimono" bearing his family crest, Koizumi walked into the shrine, which was surrounded by a few hundreds of well-wishers to mark the New Year's Day.

He bowed deeply at the main chamber before being escorted inside by a Shinto priest and spent a few minutes paying his respects out of sight from the media.

Honouring 2.5 million Japanese war dead, Yasukuni is widely seen as a symbol of Japan's former militarism, particularly since 1978 when it enshrined 14 Class-A war criminals including wartime prime minister General Hideki Tojo. Koizumi is only the third prime minister to visit the shrine since 1978.

It was Koizumi's first visit to the shrine on a New Year's Day, the nation's most important national holiday, since he took office in 2001.

The nationalist premier has pledged to make a pilgrimage once a year to "dedicate on peace" but has avoided visiting there on sensitive days such as August 15, the anniversary of the end of World War II.

Koizumi made his third trip on January 14 last year, drawing harsh criticism from China, South and North Korea, and other Asian nations.