Iraqi fighters toting machine guns and grenade launchers swaggered through the rubble-strewn streets of this town on the Syrian border Friday, setting up checkpoints and preparing to do battle despite a major U.S. offensive aimed at rooting out followers of Iraq's most-wanted militant.

The remote desert region is a haven for foreign combatants who slip across the border along ancient smuggling routes and collect weapons to use in some of Iraq's deadliest attacks, according to the U.S. military. But the fighters who remain in this Sunni town some 200 miles west of Baghdad insist there are no foreigners among them.

"We are all Iraqis," one gunman, his face covered with a scarf, told The Associated Press. He said the fighters were trying to prevent U.S. forces from entering the town.

The 6-day-old U.S. offensive in the area — one of the largest since insurgents were forced from Fallujah six months ago — was launched in Qaim and is aimed at supporters of Abu Musab al-Zarqawi (search).

U.S. military spokesman Capt. Jeffrey Pool said Marines have not conducted operations inside Qaim (search) since the opening days of the campaign, known as Operation Matador (search), which began overnight Saturday and led to the killing of six suspected insurgents and capture of 54 in the town.

Instead, according to Pool, rival bands of insurgents are now fighting among themselves, trading mortar, gun and rocket-propelled grenade fire almost nightly.

Residents acknowledge fighting in Qaim began even before the U.S. offensive, and characterized it as tribal clashes. The cause of the clashes was not immediately clear.

The U.S. offensive comes amid a surge of militant attacks that have killed at least 430 people across Iraq since April 28, when the country's first democratically elected government was announced.

Also Friday, an American soldier was killed and four others wounded when a car bomb exploded in Beiji, 155 miles north of Baghdad, the military said in a statement. At least 1,613 members of the U.S. military have died since the beginning of the Iraq war in March 2003, according to an Associated Press count.

The U.S. military said Friday its forces have met little resistance in the Qaim region since the first two days of the offensive, when they confronted surprisingly well-organized and well-equipped insurgents fighting from rooftops and inside sandbag bunkers in the nearby town of Obeidi.

U.S. forces have set up checkpoints on the outskirts of Qaim and launched airstrikes in villages less than six miles away, but now American intelligence indicates most insurgents are either in hiding or have fled the region, Pool said.

Dozens of gunmen, however, were in plain sight Friday, guarding major intersections and checking vehicles at the entrance to the town. The streets were largely deserted, and shops and markets were closed.

Thousands have fled Qaim since U.S. warplanes and helicopter gunships pounded the region earlier this week, flattening homes and other buildings. Many pitched flimsy tents along sand-blown desert highways, or moved into schools and mosques in towns further east. The Iraqi Red Crescent told the British Broadcasting Corp. it needs tents and water for the refugees.

Associated Press Television News footage showed Qaim residents on Friday clearing the heavily damaged Saghir al-Rawi Mosque, which they claimed was hit in a recent U.S. strike.

"What kind of an act is that?" asked one angry resident as he pulled a copy of the Quran, the Muslim holy book, from under the rubble.

But Pool said it was more likely damaged by fighting among rival groups of gunmen.

Qaim's hospital was also damaged in shelling. Doctors tended to bloodied young men at a makeshift facility set up in a private home Friday. The victims said a rocket slammed into them as they were standing on a bridge over the Euphrates River, killing two and wounding six. They did not say what they were doing on the bridge.

American warplanes roared overhead and plumes of smoke rose from nearby villages, but Qaim remained calm Friday. The U.S. military confirmed two air strikes in the region, one in a cave and the other in a village west of Saadah.

On Thursday, U.S. fighter jets destroyed a suspected insurgent safe house in Karabilah village, after Marines took fire from at least four gunmen in the building, the U.S. military said. It said gunmen were taking over the homes of Iraqi citizens to evade Marines.

The U.S. military has confirmed five Marine deaths so far and says about 100 insurgents have been killed in the operation. But a Washington Post reporter embedded with U.S. forces put the American death toll Thursday at seven — six of them from one squad.

The new interim prime minister, Ibrahim al-Jaafari, extended Iraq's state of emergency for another 30 days Friday, effective from May 3. The emergency decree, which covers all of Iraq except the northern Kurdish-run areas, has been renewed monthly since it was first imposed Nov. 7 — hours before the Fallujah offensive. It includes a nighttime curfew and gives security forces powers of arrest without warrants.

At least nine more Iraqis were killed and 19 wounded in a series of bombings, ambushes and other attacks Friday.

They included Iraqi army Maj. Murtadha Younis Hwesh who was killed in a drive-by shooting in western Baghdad, the Defense Ministry said. Also, snipers fired on the motorcade of Interior Ministry undersecretary, Maj. Gen. Hikmat Moussa Hussein, killing one of his guards and wounding three others, police said. Hussein escaped unharmed.

Also Friday, a gunfire exchange with coalition forces in Mosul, 225 miles northwest of Baghdad left five Iraqi civilians and three suspected insurgents dead.

The U.S. military said insurgents in several vehicles tried to ram into a coalition convoy, then fired on the convoy with small arms. Coalition forces returned fire, destroying one vehicle and killing three insurgents, the military said in a statement. When two more vehicles approached, coalition forces took them to be hostile and again opened fire, the statement said. The military did not give the nationality of the forces involved, but said the incident was under investigation.

In another development, Iraqi security forces, with help from the Shiite Muslim Badr Brigades militia, captured an Iraqi and four Palestinians who allegedly carried out a deadly Baghdad market bombing Thursday that killed at least 17 people. The militia is the military wing of the Supreme Council for the Islamic Revolution in Iraq and Iraq's new interior minister, Bayan Jabr, is a SCIRI member.