An Iraqi gestures while looking at destroyed cars at site where roadside bomb exploded at Baghdad's al-Rasafi square, 1 Feb 2007

A new report by U.S. intelligence agencies warns that unless the situation in Iraq is stabilized, the nation could slide into chaos and be divided into warring ethnic states.

The report is part of a declassified version of a National Intelligence Estimate on Iraq issued  Friday in Washington.

It says the term "civil war" accurately describes key elements of the Iraqi conflict. But it says that term does not adequately portray the complexity of what is going on in Iraq, with Shia-on-Shia attacks, al-Qaida-linked and Sunni insurgencies, and widespread criminal violence.

The intelligence report says that if Iraqi troops backed by U.S.-led coalition forces could reduce sectarian violence, Iraqi leaders could begin the process of political compromise. But the report cautions that Iraqi leaders, given what it calls the current "winner-take-all attitude," would be hard-pressed to achieve any results over the next year.

President Bush and others in his administration have repeatedly disputed the notion that Iraq is in civil war. Just before the report was issued, Defense Secretary Robert Gates told reporters the words "civil war" oversimplify a very complex situation in Iraq.

The report follows Mr. Bush's recommendation to send more than 21,000 additional U.S. troops to Iraq. Democrats and some Republicans in Congress have been highly critical of the president's plan.

The intelligence report notes that Iraq's neighbors are likely not to be a major force in the violence, because of what it calls the "self-sustaining" character of the sectarian conflict. This also would appear to be at odds with recent Bush administration efforts to blame Iran for its role in the violence.

Some information for this report was provided by AFP, AP and Reuters.