Iraq's interim authority has submitted a timetable for self-rule and asked the UN Security Council for a new resolution that would end the US-led occupation in June.
In a letter to the Security Council, Mr Jalal Talabani, president of the Iraqi Governing Council, promised to establish the "principle of civilian control over the Iraqi armed and security forces".
The US-appointed council said it would select a "provisional legislative body" no later than May 31st, 2004, which would elect a provisional government by the end of June.
Then "the Coalition Provisional Authority will be dissolved and the occupation . . . will end", Mr Talabani's letter said.
Security on the ground in Iraq was intense as troops went on alert for attacks marking the end of the Muslim holy month of Ramadan after the weekend killings of US soldiers.
Thousands of Muslims gathered at Baghdad's Abu Hanifa mosque, one of Sunni Islam's holiest shrines, to pray and participate in the Eid al-Fitr, the celebration that marks the end of a month of dawn-to-dusk fasting.
Since Washington declared major combat in Iraq over on May 1st, 185 soldiers have died in action.
On Sunday, witnesses said two US soldiers were shot in the northern city of Mosul, before being dragged from their car in broad daylight and beaten and stabbed by an angry crowd.
Another soldier was killed on Sunday by a roadside bomb near the town of Baquba, 65 kilometres north of Baghdad.