Iraqi government forces and U.S. troops began a major operation Saturday to retake a northern town largely under rebel control since the 2003 invasion.

Baghdad International Airport (search) — Iraq's only reliable and relatively safe link to the world — reopened a day after a British security company suspended operations there, complaining it had not been paid for months.

Troops combed the streets of Tal Afar (search), using Bradley armored vehicles to smash down walls in a house-to-house search for insurgents. Gunfire could be heard from the Sarai district, the oldest part of the town.

"At 2 a.m. today, acting on my orders, Iraqi forces started an operation to remove all remaining terrorist elements from the city of Tel Afar," Prime Minister Ibrahim al-Jaafari said in a statement. "These forces are operating with support from the Multinational Force."

The town, located on the Euphrates River 260 miles northwest of Baghdad (search), lies along one of the main infiltration routes from Syria. It has been largely outside the control of occupation forces since the 2003 invasion.

The U.S. military carried out a major campaign in the area a year ago, eventually pulling out to concentrate forces for the assault on the rebel-held town of Fallujah.

The Tal Afar offensive has been expected for several weeks, and the U.S. military has carried out air and artillery strikes in the area. Most of the city's 200,000 people reportedly have fled to the surrounding countryside.

On Friday, the government hinted the operation was imminent, and the U.S. military reported killing 11 insurgents during raids over the past two days.

An estimated 5,000 U.S. and Iraqi troops, mostly members of the 2nd Division from the Kurdish city of Irbil, surrounded Tal Afar. They were reported to be facing several hundred lightly armed guerrillas.

"The terrorist elements being targeted by this operation are guilty of blatant crimes against its people," Jafaari's statement said. "They want to deny the citizens of Tel Afar their future in a democratic and peaceful Iraq. We want to guarantee those rights. These operations are being conducted precisely for that purpose."

In Baghdad, acting Transportation Minister Esmat Amer told The Associated Press that the airport — once known as Saddam International — had reopened after late-night negotiations between the government and London-based Global Strategies Group (search).

"We have reached agreement with the Global security firm, and the airport is open now for domestic and international flights," Amer said. He refused to elaborate.

Global has been providing security at the airport 12 miles from downtown Baghdad since last year. On Friday, Global suspended operations claiming the transportation ministry, which owns the airport, was six months behind in payments.

The Interior Ministry sent troops Friday to reopen the dusty, sprawling stone-and-marble facility but called them back after confronting U.S. forces at a checkpoint.

The closure of the French-built airport was believed to have been the first serious public conflict involving a Western contractor since the U.S.-led invasion ousted Saddam Hussein two years ago.

The United States has managed to keep its forces in Iraq — now at about 140,000 — to a minimum by hiring contractors for vast amounts of work the military normally would do. Congress has complained that oversight is lax and the U.S. government is routinely overcharged.