Overall, about 130 people were killed or found dead across the country, reflecting the ongoing wave of sectarian and insurgency bloodletting as the US military gears up for a major security operation to stem the violence.

Iraqi authorities on Friday clamped a total curfew on Shia Islam's holiest city of Najaf to thwart attacks a day after 73 people died in twin suicide bombings in nearby Hilla.

In Baghdad, the US military was probing reports that another helicopter had gone down near Taji, north of the Iraqi capital.

If confirmed, it would be the third US military helicopter lost in two weeks. A private US security chopper also crashed in Baghdad on January 22.

In the central Iraqi city of Najaf, "the curfew imposed overnight has been extended and includes the entire region around Najaf including Kufa, northeast of the holy city," police said.

The statement came after police and witnesses reported that at least one helicopter had been shot down Friday in the area surrounding Taji, an air base 12 miles north of the capital. Some witnesses described two helicopters going down.

"I can confirm that we are looking into reports that a helicopter went down north of Baghdad," US military spokeswoman Lt Col Josslyn Aberle said.

Police and witnesses said the area had been sealed off by American forces and US planes were flying overhead.

The biggest attack Thursday took place in the centre of Hillah, a city about 60 miles south of Baghdad. Police and witnesses said the two bombers strolled into the Maktabat market about 6 p.m. when the area was packed with shoppers buying food for the evening meal.

One of the bombers detonated his explosives when he was approached by police and the other blew himself up moments later, according to police spokesman Capt. Muthanna Khaled, who gave the casualty figures. He said Friday that the toll had risen after several of the wounded died and more bodies were found in recovery efforts.

The blasts sent bodies hurling through the air and set fire to wooden stalls where vendors sold fruits and vegetables, witnesses said. Shoppers fled screaming in panic, while others stopped to help rescuers carry away the wounded.

Dr Mohammed Diya of the Hillah General Hospital said some of the wounded were in critical condition, raising concern the death toll could rise.

Qassim Abed Sadah, 33, a bookseller, said the first explosion blew him out of his chair. He raced to the door of his shop just as the second blast occurred. "People were flying in the air," he said.

Mahdi Latif, 35, a fruit vendor, said he saw a policeman motion for the first bomber to stop for a search.

"Seconds later I saw a ball of fire and all I remember is me and many other people trying to flee the area," he said.

Pools of blood were scattered along the market streets, along with bits of fruits and vegetables. Paramedics wearing white gloves roamed through the area removing body parts.

No group claimed responsibility for the attack, the latest in a long series that have occurred in Hillah since the insurgency erupted in late 2003. The Shia city, located in a religiously mixed province, was the scene of one of Iraq's deadliest attacks a February 2005 suicide car bombing that killed 125 people.

In Baghdad, sectarian violence flared in both Shia and Sunni areas of the capital, where US and Iraqi forces are preparing for the third major security crackdown in a year.

Six people died and 12 were wounded when a car bomb exploded on Rashid Street in the mostly Shia heart of the city. A bomb on a public bus killed another six people and wounded eight in the upscale Shia commercial district of Karradah.

Several mortar rounds slammed into the Sunni district of Azamiyah for a third straight day, killing five people and wounding 12, according to hospital and police officials.

"What have we done to be attacked like this almost every day?" asked Saad Abdul-Karim, 50, whose son was wounded when one of the rounds struck their home.

Police found the bullet-riddled bodies of 33 men scattered across the Iraqi capital, the Interior Ministry said. Most showed signs of torture and were believed to be the victims of Shia and Sunni death squads.

Elsewhere, a US soldier died Thursday of wounds suffered two days ago in Anbar province, a Sunni insurgent stronghold west of Baghdad, the military said. Three civilians were killed in separate shootings in the northern city of Mosul, and a policeman died in a car bombing in the city of Qaim on the Syrian border, police said.

In Baqouba, five gunmen broke into the athletic department of a local university, seized the son of the department's director, took him into his father's office and shot both of them dead, police said. The city, located about 35 miles northeast of Baghdad, has been riveted by sectarian violence for months.

US officials have accused Iran of fomenting sectarian strife by arming and training Shia militias. President Bush has authorised US forces to kill or capture any Iranian agents found in this country. Defence officials are also looking into the possibility that Iranian agents may have been behind the Jan. 20 attack in Karbala in which five Americans were killed four of them after being taken prisoner.

In an interview with NPR, US Undersecretary of State Nicholas Burns said there was a "political and moral difference" between what the United States and the Iranians are doing in Iraq, reiterating allegations that Tehran has been supporting Shia militias that have been blamed for much of the recent sectarian violence in Iraq.

However, the US-backed Iraqi government includes Shia and Kurdish parties with longtime ties to Iran, and the rising US-Iranian tensions adds new strains to an Iraqi leadership barely able to cope with the worsening security crisis.

During a news conference Thursday, the chief government spokesman said Iraq would consider any attack against US forces in Iraq as an assault against this country. But he added that Iraq also wants good relations with Iran.

"We have long borders with (the Iranians), we have local interests with (them) and we would like to have our relation not in the shadow of the others," spokesman Ali al-Dabbagh said.

On Wednesday, Prime Minister Nouri al-Maliki, a Shia, said on CNN that Baghdad had told both the Iranians and the Americans "to solve your problems outside of Iraq."