Iraq's parliament on Saturday postponed a vote to approve a new government under Prime Minister-designate Haidar al Abadi.
Members of parliament instead argued about Iraq's budget after the session to approve a new government was put off until Monday.
Monday marks a constitutional deadline for Abadi to form his government, after which a new candidate must be chosen to do so.
Although Abadi insists his new government will be announced before the deadline expires, the delay comes amid disagreements over who should hold key posts, including those of defense minister, continue.
If the deadline expires, President Fouad Mahsoum may then choose who will form the government after political consultations.
Iraqi state TV reported that outgoing Prime Minister Nouri al-Maliki denounced what he called a “negative climate” in which “religious and political rivalries” were impeding the government's formation.
According to Ahmed al Jabbouri, a spokesman for Sunni parliament speaker Salim al Jabbouri, rival Sunni and Shi'ite blocs in particular are quarreling over top defense and interior ministry posts.
The United Nations representative to Iraq, Nickolay Mladenov, has met with Speaker Jabbouri to offer assistance on behalf of the world deliberative body, the spokesman said.
Sunni parliamentarian Abdel Qader al Sumurrai insisted that Sunni politicians are unwilling to accept any ministerial agreement which does not fulfill their aspirations or which marginalizes any political group.
Shi'ite parliamentarian Razak al Nujeimi said his Badr Bloc party believes it should be given the defense ministry post.
Several female members of parliament complained in a press conference that no female candidate appeared to have been given a major post in the tentative list of new ministers, calling it an affront to women's rights and the Iraqi constitution.
Iraqi state TV reported that U.S. special envoy Brett McGurk and U.S. Ambassador to Iraq Robert Beecroft met with Speaker Jabbouri to encourage Iraqi politicians to agree on the new government before Monday.
Witnesses reported that Iraqi military forces were on alert around Baghdad's Green Zone, where parliament and other government offices are located.