A five-day surge in attacks has left more than 400 Iraqis dead, many of them in bombings on Shia markets and neighbourhoods in Baghdad, and Sunnis and Shias headed for their rival mosques under a cloud of suspicion.

Health ministry executive director Hakim al-Zamly said August's overall death toll would be lower than the previous month's, after a joint US-Iraqi military crackdown, but that the latest killings could spark reprisals.

"Now I fear the violence will go up, especially after what happened yesterday," he said, referring to synchronised barrage of bomb and rocket attacks on Shia and Christian districts which he said killed 67 civilians.

"It will bring violence from this side and the other," Al-Zamly warned.

More than 300 people were also wounded in the blasts, which tore through a street market killing women and children and demolished several homes, including some in Sadr City, a bastion of Baghdad's powerful Shia militias.

Meanwhile, a US marine and a soldier died from wounds sustained due to "enemy action" in the western Iraqi province of Al-Anbar, the military said Friday.

The two servicemen were wounded on Wednesday, but the military did not specify when they actually died.

Their deaths bring to 17 the number of US servicemen killed in Iraq since Sunday, and to 2,637 since the March 2003 invasion, according to an AFP count based on Pentagon figures.

The four-hour vehicle curfew to protect Friday's worshippers came and went without reports of violence, but preaching at the mosques was marked by anger.

"The Iraqi government should stop these acts and the ministries of defence and interior should work to prevent such terror," said Mohammed Al-Haidari, a follower of Shia spiritual leader, Grand Ayatollah Ali al-Sistani.

Haidari told worshippers that in one of Thursday night's attacks, extremists had hired a flat in a Shia residential block and rigged it with explosives, bringing down the whole structure and crushing entire families.

"The enemy wants to exploit local strife and chaos so that Iraq will move into a civil war. Iraqis should be hand in hand against terror to deny these criminals a chance to provoke conflict between Sunnis and Shias," he said.

The official figures for those killed and wounded across Iraq in August are expected to be released on Sunday, and US and Iraqi commanders expect them to be lower than July's record levels, especially in the war-torn capital.

Iraqi and US troops have launched a large-scale security operation in the city and officers boast that they have cut the daily death toll from sectarian death squad attacks by more than 40 percent.

The final days of the month, however, were marked by a spike in violence across the country, and an AFP tally of official reports put the toll since Sunday at 17 US soldiers and more than 400 Iraqis dead.

Against this background, Prime Minister Nuri al-Maliki's government is pressing forward with plans to take responsibility for Iraq's security back from its allies in the US-led coalition.

On Saturday, Iraq will announce the creation of a joint military command to oversee the work of its navy, airforce and 10 army divisions, five of which are already the lead security force in their areas of responsibility.

Hitherto, Iraqi divisions had been coordinated by US commanders, but over the coming months the national command centre will gradually integrate them into one chain of command leading down from Maliki himself.

In the coming days, the government will also take charge of security in Dhi Qar, the second of Iraq's 18 provinces deemed secure enough for British-led coalition forces to take a back seat while local forces lead the way.

Both of these steps have been hailed by US commanders as a sign that Iraq is finally ready to lead the fight against insurgents, who oppose the US-led overthrow of former leader Saddam Hussein or are inspired by militant Islam.

The US commander in Iraq, General George Casey, said this week Iraq would be able to handle its own security within 12 to 18 months and President George W. Bush reiterated his vow to leave US forces in place until this is achieved.

Currently there are 141,000 US troops in Iraq -- more than the 115,000 Iraqi troops in the national army -- and several thousand more from US allies.

British forces in the southeast of the country are gradually pulling out of fixed positions in areas outside Iraq's volatile second city Basra, and Italy's remaining 2,000 troops are expected to leave by the end of the year.

Nevertheless, many challenges remain. Iraq's fragile coalition government has yet to decide how to deal with the challenge of the Shia militias, which control several Baghdad districts and large areas of the south.

The militias are linked to powerful parties in the ruling coalition, and are not in open rebellion against Maliki's government. Nevertheless, clashes with security forces are becoming more common as the parties jostle for power.

On Monday, for example, fighting between the army and a Shia militia in the city of Diwaniyah, south of the capital, left 23 soldiers and 40 militiamen dead. Iraqi and US commanders have threatened an offensive to retake the town.