The blaze came a day after Baghdad's mayor decried the capital's crumbling infrastructure and the lack of clean water and threatened to resign if the Iraqi government won't provide more money.

Friday's fire began at about 7 a.m. local time and it affected the Karkh water station in Tarmiyah, which serves northern and western Baghdad, officials said.

The water project's director, Jassim Mohammed, said he believed the fire started after insurgents set off a bomb. He said it would take at least three days to get spare parts and repair the damage, which has completely halted all water distribution from the plant.

A municipal official said the blaze was still under investigation.

"It's not clear if it was an explosion (caused by insurgents) or a technical problem," said the official, who spoke on condition of anonymity because of the sensitivity of the information.

While militants frequently target infrastructure, loud explosions can occur when a transformer blows.

Iraqi engineers told the US military the fire resulted from a blown transformer and was not the result of an insurgent attack, said Sgt. 1st Class David Abrams, a spokesman for Task Force Baghdad. "We verified with engineers on the site that it was a blown transformer," Abrams said.

Efforts to expand Baghdad's water supplies were set back earlier this month when insurgents sabotaged a pipeline near Baghdad.

Mayor Alaa Mahmoud al-Timimi's threat to resign over the dismal state of the capital's infrastructure was an indication of the daily misery that Baghdad's 6.45 million people still endure more than two years after the US-led invasion. They are wracked not only by unrelenting bombings and kidnappings, but by serious shortages in water, electricity and fuel.

"It's useless for any official to stay in office without the means to accomplish his job," al-Timimi told reporters Thursday.

Al-Timimi wants $1.5 billion from the Iraqi national government for Baghdad in 2005 but so far has received only $85 million, said his spokesman, Ameer Ali Hasson.

Some complain the water they do get smells bad, and Hasson acknowledged in some areas, the water gets mixed with sewage. "The problem is escalating," said al-Timimi, a Shia who took office in May 2004.