BAGHDAD, Iraq (AP) – Iraqi officials said Monday that U.S.-backed Iraqi troops had targeted a messianic cult called “Soldiers of Heaven” in a weekend battle that left 200 fighters dead, including the group’s leader, near the Shiite holy city of Najaf. A military commander said hundreds of gunmen planned to disguise themselves as pilgrims and kill clerics on the holiest day of the Shiite calendar.

The Iraqi government spokesman, Ali al-Dabbagh, said the raid on Sunday in date-palm orchards on the city’s outskirts was aimed against the fringe Shiite cult that some Iraqi officials said had links to Saddam Hussein loyalists and foreign fighters. Officials said the group, which included families, was hoping the violence it planned would force the return of the “hidden imam,” a 9th-century Shiite saint who Shiites believe will come again to bring peace and justice to the world.

U.S. and British jets played a major role in the fighting, dropping 500-pound bombs on the militants’ positions, but President Bush said the battle was an indication that Iraqis were beginning to take control.

“My first reaction on this report from the battlefield is that the Iraqis are beginning to show me something,” Bush told NPR.

The fighting began Sunday and ended Monday. U.S. officials said an American military helicopter crashed during the battle, killing two soldiers on board, but gave no further details. Maj. Gen. Othman al-Ghanemi, the Iraqi commander in charge of the Najaf region, said the aircraft was shot down. It was the second U.S. military helicopter to crash in eight days.

Both Mohammed al-Askari, the defense ministry spokesman, and al-Ghanemi said 200 terrorists were killed and 60 wounded, lowering previous estimates. Al-Ghanemi said 150 had been captured, while al-Askari put that figure at 120.

Authorities said Iraqi soldiers supported by U.S. aircraft fought all day Sunday with a large group of insurgents in the Zaraq area, about 12 miles northeast of Najaf.

Provincial Gov. Assad Sultan Abu Kilel said the insurgents had planned to attack Shiite pilgrims and senior clerics in Najaf during ceremonies marking Ashoura, the holiest day in the Shiite calendar commemorating the 7th-century death of Imam Hussein, grandson of the Prophet Muhammad. The celebration culminates Tuesday in huge public processions in Najaf, Karbala and other Shiite cities.

Al-Ghanemi said the army captured some 500 automatic rifles in addition to mortars, heavy machine guns and Russian-made Katyusha rockets in what amounted to a major test for Iraq’s new military as it works toward taking over responsibility for security from U.S.-led forces.

The commander said the leader of the group, called the Jund al-Samaa, or Soldiers of Heaven, was among those killed and identified him as an Iraqi named Ahmed Hassan al-Yamani, who went by several aliases and was armed with two pistols when he died. Abdul-Hussein Abtan, deputy governor of Najaf, said the cult leader had been detained twice in the past few years, although he did not say why.

Ahmed al-Fatlawi, a member of the Najaf provincial council, some of the gunmen brought their families with them in order to make it easier to enter the city. “The women have been detained,” he said. Al-Fatlawi added that they gunmen included Shiites, Sunnis, Iraqis, Arabs and foreigners. He did not give their nationalities.

Al-Ghanemi said the area where the men were staying was once run by Saddam’s al-Quds Army, a military organization the late president established in the 1990s. The commander said “the gunmen had recently dug trenches in preparation for the battle.” He added that the area of full of date palm groves. Other officials in Najaf said Saddam loyalists bought the groves six months ago.

Al-Ghanemi said 600 to 700 gunmen had planned to disguise themselves as pilgrims and attack Najaf on Tuesday, the day they believed that the Imam Mahdi, or the “hidden imam,” would reappear. He said leading Shiite ayatollahs consider such fringe elements as heretics.

Al-Ghamemi said their aim was to kill as many leading clerics as possible, including the main ayatollahs, which would include Iraq’s main Shiite spiritual leader Grand Ayatollah Ali al-Sistani. They even had leaflets saying that the hidden imam would reappear, he said.

Najaf government officials indicated the militants included both Shiite and Sunni extremists, as well as foreign fighters. Although Sunni Arabs have been the main force behind insurgent groups, there are a number of Shiite militant and splinter groups that have clashed from time to time with the government.

The mortar attacks and bombings appeared to be part of the sectarian reprisal killings that have pushed Iraq into civil warfare over the past year, violence that Bush hopes to quell by sending up to 21,500 more American soldiers to Baghdad and surrounding areas.

Bombings, mortar attacks and shootings killed at least 36 people elsewhere on Monday.

In one of the worst attacks, mortar rounds rained down on a Shiite neighborhood in the Sunni-dominated town of Jurf al-Sakhar, 40 miles south of Baghdad, Monday morning, police spokesman Capt. Muthanna Khalid said. He said 10 were killed, including three children and four women, and five other people were wounded.

Also Monday, a prominent Shiite leader renewed his calls for setting up federal regions in Iraq, saying that would solve the country’s problems.

Abdul-Aziz al-Hakim, leader of the Shiite bloc in the 275-member parliament, spoke at a Shiite mosque in central Baghdad to mark Ashoura. “I reaffirm that the establishing of regions will help us in solving many problems that we are suffering from. Moreover, it represents the best solution for these problems,” he said.

Al-Hakim said his concern cut across sectarian lines.

“I sympathize with our Sunni brothers in their ordeal with the terrorists as I sympathize with the Shiites in their ordeal with the terrorists,” he said. “I condemn the killing of Sunnis as I condemn the killing of the Shiites.”