American soldiers killed 11 suspected Shiite gunmen in clashes Wednesday in a militia stronghold near Baghdad's Sadr City, scene of a major Iraqi army clampdown, the U.S. military said.

Sadr City itself remained calm, a day after some 10,000 Iraqi troops fanned out in the district in the government's biggest move yet to establish control in the bastion of the Mahdi Army, the Shiite militia loyal to anti-U.S. cleric Muqtada al-Sadr.

Mahdi Army fighters were not visible in the streets of Sadr City, and long-closed shops began to reopen in parts of the district hardest hit by past clashes, as Iraqi soldiers and police set up more checkpoints to beef up their hold.

If the move into Sadr City succeeds, it will be a major boost for Prime Minister Nouri al-Maliki's government, which is trying to extend its authority over regions where armed groups and militias have held sway.

But much depends on whether a truce holds with Mahdi Army fighters, who remain armed and could resist when the troops carry out their plans to confiscate any heavy weapons hidden in the area and arrest key suspects.

The violence Wednesday also raises fears that Shiite fighters could stir up trouble in nearby parts of eastern Baghdad.

The U.S. military identified the 11 killed Wednesday in the New Baghdad district as "special group criminals," terminology it uses to refer to rogue Shiite fighters who defy al-Sadr's cease-fire orders.

Four heavily armed militants were killed while traveling in a sport utility vehicle, four others were killed because they engaged in suspicious behavior, and three were killed after they were spotted planting two separate roadside bombs, according to a statement.

Two Iraqi police officials, who spoke on condition of anonymity because they weren't authorized to release the information, said earlier that 11 bystanders, including two street sweepers, were killed and one wounded when joint U.S.-Iraqi troops opened fire after a roadside bombing in the area.

The U.S. military initially denied its forces were involved but later issued a release detailing a series of attacks.

AP Television News footage showed the body of a man in a track suit covered by a blue blanket and another body in a blood-spattered wooden coffin nearby.

Under the truce that paved the way for the deployment in Sadr City, the Mahdi Army promised not to attack residential areas or the Green Zone. Iraqi forces promised to try to refrain from seeking American help to restore order in the district. No American forces were involved in the deployment, code-named "Operation Peace."

The so far peaceful move into Sadr City is in stark contrast to a trouble-ridden offensive launched in late March in the southern city of Basra, which sparked widespread fighting across the south and in Sadr City between the Mahdi Army and U.S.-Iraqi forces.

In the weeks of violence that followed, militants in Sadr City barraged the Green Zone with rocket fire.

In response, U.S. and Iraqi forces moved into the southern part of Sadr City in April, seizing two sectors and building what is now a nearly completed concrete wall between them and the rest of the district.

Both sides appear intent on avoiding a similar confrontation in Sadr City, which would mean tough urban fighting in crowded slums. Iran, which is close to both the Sadrist movement and the Shiite parties in al-Maliki's government, also appears to want calm. It mediated a truce in Basra in mid-April, and Iraqi officials consulted with Iran ahead of the Sadr City agreement as well.

Basra has calmed greatly in recent weeks, and government forces appear to have increasing control there as they continue to arrest militia fighters.

Al-Maliki launched a sweep more than a week ago in the northern city of Mosul aiming to uproot Al Qaeda in Iraq and other Sunni insurgents.

An official with the provincial command center for Ninevah said a man said to be Al Qaeda in Iraq's top leader in Mosul confessed to having contacts with a senior member of the ousted ruling Baathist party, Mahmoud Younis al-Ahmed, as well as directing brigades from Sunni insurgent groups.

The official was familiar with the investigation but declined to be identified because he was releasing the information ahead of a formal announcement.

The Iraqi Interior Ministry said Monday that Al Qaeda's self-confessed "wali" — or "governor" — in Mosul, Abdul-Khaliq al-Sabawi, was captured in the nearby province of Salahuddin.

Maj. Gen. Mark Hertling, the commander of American forces in northern Iraq, denied that al-Sabawi was the leader of the terror network in Mosul, saying he was a leading insurgent but belonged to a rival group, not Al Qaeda.

Meanwhile, Iraqi President Jalal Talabani joined other Iraqi officials in denouncing the use by an American sniper of a copy of the Quran for target practice. He said the May 9 incident angered and disappointed all Iraqis, according to a statement by his office.

Jalal Talabani, a Sunni Kurd, said leaders of U.S.-led coalition forces in Iraq had a duty to "educate" their troops on the need to respect all religions and holy books.

President Bush apologized to al-Maliki over the incident on Monday.