Members of Iraq's Governing Council (search) traveled to Najaf (search) on Thursday to help nail down a peace agreement after radical cleric Muqtada al-Sadr (search) offered to withdraw his militia, raising hopes for an end to weeks of fighting in the holy city.

Al-Sadr, whose militiamen have been battling coalition troops for nearly two months, also demanded the Americans pull back and a murder case against him be postponed.

The Wednesday offer was conveyed in an announcement by National Security Adviser Mouwafak al-Rubaie (search), himself a Shiite. Al-Sadr also could not be reached to confirm it directly.

Ahmed al-Shibani, an al-Sadr aide, said there was "no truth" that a final agreement had been struck and that al-Rubaie "is talking on his own."

However, al-Sadr has made similar offers before, and it appeared the coalition was taking this one more seriously. One coalition official, speaking on condition of anonymity, called it a "huge" step toward resolving the crisis in the Shiite heartland.

An agreement to abandon Najaf would be a major step toward ending an uprising al-Sadr's militia has waged in the south only weeks before a new Iraqi government takes power June 30, formally ending the U.S.-led occupation.

The weeks of fighting — which had threatened some of Shia Islam's holiest sites — had posed a major challenge to the U.S. occupation.

Adnan Ali, a senior official of the Shiite Dawa party, said a "preliminary agreement" had been reached to end the standoff in Najaf "but some details need to be finalized."

Three Shiite members of the Iraqi Governing Council — Salama al-Khafaji, Ahmad Chalabi and Abdul-Karim Mahoud al-Mohammedawi — arrived in Najaf to help firm up the agreement and encourage the Americans to pull their forces from the city.

Al-Khafaji said the three would stage a sit-in at the Sahla mosque in nearby Kufa until the Americans leave. U.S. soldiers raided the mosque last weekend, seizing weapons and ammunition stored there by al-Sadr's fighters.

It wasn't known how much al-Sadr was swayed by the pre-dawn raid in which U.S. troops arrested al-Sadr's key lieutenant. Clashes late Tuesday and early Wednesday between U.S. troops and militia fighters killed 24 people and wounded nearly 50 here, hospital and militia officials said.

Riyadh al-Nouri was seized during a raid on his Najaf home about 4 a.m. Wednesday. U.S. officials said al-Nouri offered no resistance.

Al-Nouri's arrest was a major blow to the al-Mahdi Army, which has been fighting coalition forces since early April in Shiite neighborhoods of Baghdad and in the Shiite heartland south of the capital.

Al-Sadr launched his uprising after the U.S.-led occupation authority launched a crackdown on his movement. An Iraqi judge has issued an arrest warrant charging both al-Sadr and al-Nouri in the April 2003 assassination of a moderate cleric, Abdul Majid al-Khoei.

Al-Rubaie, a Shiite and former Governing Council member, said al-Sadr made the offer in a letter to the city's Shiite clerical hierarchy. According to al-Rubaie, al-Sadr offered to remove his fighters from Najaf — except for those who live there — but demanded that U.S. and other coalition troops "return to base," allowing Iraqi police to regain control of the city.

The young Shiite radical also demanded "broad discussions" within the Shiite community over the future of his al-Mahdi Army militia and that the legal proceedings against him be deferred until then.

Al-Sadr said he was making the offer because of "the tragic condition" in Najaf after weeks of fighting between his militiamen and the Americans and the slight damage suffered by the city's holiest shrine, the Imam Ali mosque.

Fighting around some of the holiest cities of Shia Islam has angered many Shiites in Iraq and elsewhere and has led to calls for both the Americans and the militiamen to pull back from the shrines.

On Tuesday, the Imam Ali shrine in Najaf received slight damage. Both U.S. and Shiite forces blamed the other.

U.S. officials have expressed their desire for a peaceful settlement to the standoff but have insisted that al-Sadr disband his "illegal militia" and submit to "justice before an Iraqi court."

"We still are committed to finding a peaceful resolution to this problem," Brig. Gen. Mark Kimmitt, coalition deputy chief of operations, told reporters in Baghdad before word of al-Sadr's offer. "But until that peaceful resolution comes forward ... we will continue to conduct military operations directed against his forces."

Also Wednesday, three Marines were killed in Anbar province "while conducting security and stability operations," the military said, declining to release further details because of security concerns. The province includes the western suburbs of Baghdad as well as Fallujah, Ramadi and Qaim.

Elsewhere, three Iraqis were killed and nine were wounded when a roadside bomb exploded Wednesday in southwest Baghdad, the U.S. command said. Two of those killed and one of the wounded were believed to have been trying to set the bomb, the command said without elaborating.

A roadside bomb exploded Wednesday on Baghdad's Tahreer Square near a main bridge across the Tigris River, damaging a U.S. Army vehicle. There was no word on casualties.

In Baqouba, about 30 miles northeast of Baghdad, five people were killed and seven others wounded when a roadside bomb exploded near a convoy that included the city's police chief, who escaped injury.