An angry mob of former Iraqi soldiers charged at U.S. troops and Iraqi police on Saturday, throwing rocks during a protest to demand jobs and back pay -- prompting U.S. and Iraqi security to fire shots, killing at least one and wounding 25 according to witnesses and hospital officials.

Among the injured are two Iraqi policemen, said Dr. Abbas Jafaar, an official at a nearby hospital said.

Also Saturday, the military said that a 4th Infantry Division (searchsoldier was killed and one was wounded in an attack in southeast Baghdad. The patrol was hit Friday night with small arms fire and a rocket-propelled grenade in the As Sadiyah (searchregion.

The unrest, which began outside an American base in central Baghdad, spilled into the upscale Monsour (searchdistrict, where four liquor stores were burned along with an Iraqi police car.

The Americans fired shots in the air to drive back the stone-throwing mob, and the Iraqi police fired into the crowd, witnesses said.

The mob later returned to the area outside the American base, but an Iraqi police colonel persuaded the ex-soldiers to line up in an orderly fashion so they could be paid by the Americans.

The demonstrators complied and were standing quietly in line under heavy U.S. guard. Helicopters were overhead and three tanks could be seen.

The U.S. death brought to 88 the number of American soldiers to die in hostile action in Iraqi since President Bush declared major combat over on May 1. Since the beginning of the war 317 U.S. soldiers have died in the country.

Northeast of Baghdad in the town of Kirkush, nearly 700 recruits completed their basic training Saturday as the first battalion of a new Iraqi army, a small step in the U.S. effort to replace the giant force that disintegrated under U.S.-British attack six months ago.

The Bush administration proposed spending $2 billion to create a 40,000-member Iraqi military by the end of 2004. A second battalion begins the nine-week course on Sunday.

In a gritty desert training camp 50 miles northeast of Baghdad, the graduating battalion marched in review Saturday, high-stepping past dignitaries including the U.S. civilian administrator for Iraq, L. Paul Bremer, and Iyad Allawi, current president of the interim Iraqi Governing Council.

Iraq's U.S. military occupiers are looking for more international and Iraqi help as they try to suppress anti-American resistance forces who are staging small but deadly bombings and hit-and-run attacks. The new trainees will not join the Americans in direct combat with the insurgents, however.

Instead, U.S. officials say, they will be assigned to help the 4th Infantry Division with security on the Iranian border.

The new battalion, a light motorized infantry unit, comprises 65 officers and more than 600 men. Most were members of the former Iraqi army under ousted President Saddam Hussein. Privates will receive $60 a month.

American money is buying guns, uniforms, vehicles, and almost everything else for the new force, since the old army's equipment was taken by deserting soldiers or by looters after the war.

The Americans have bought 40,000 AK-47 assault rifles at $59 each from an undisclosed source.

The violence Saturday was the just latest in a string of outbursts from a population apparently angered by a lack of progress by the U.S. occupation force six months after Saddam Hussein was ousted.

On Wednesday, Iraqi police opened fire in the heart of Baghdad and in northern Iraq to disperse protesters complaining of corruption in the distribution of scarce jobs.

Also Wednesday, American soldiers fired warning shots over the heads of stone-throwing Shiite Muslims outside a mosque in Baghdad. The Shiites were angry over the brief detention of their preacher, who they said was questioned about allegedly inflammatory sermons.

The Associated Press contributed to this report.