Clashes between US Marines and militiamen loyal to radical Shiite Iraqi cleric Moqtada al-Sadr in the holy city of Najaf entered the third day on Saturday, witnesses said.

The two sides exchanged machinegun fire, shells and mortars in the early hours of Saturday and the fighting died down by mid-morning, but sporadic crackle of crossfire continued to be heard in some parts of the city, they said.

Sadr's supporters roamed the streets around the city's holy shrines, ignoring an ultimatum by the US-appointed governor to quit Najaf by Friday evening.

Shops and businesses remained closed as residents stayed indoors.

Some 300 Iraqis have been killed in clashes between US Marines and Sadr's militiamen in and around Najaf in the past two days, a senior US officer said Friday.

Iraqi Vice President Ibrahim al-Jafari on Friday criticized the United States, saying the reported deaths of 300 insurgents in Najaf was "not a civilized way" to rebuild his nation.

"I can not find any justification for the killings," Jafari, on an official visit to London, told BBC television's "Newsnight" program.

"I think that killing Iraqi citizens is not a civilized way of building the new Iraq, which is based on protecting people and promoting dialogue, not bullets."