The U.S.-led coalition in Iraq has agreed to suspend offensive operations against the militia of Shiite cleric Moqtada al-Sadr in Najaf. The deal was mediated by senior Shiite leaders and Iraq's national security adviser.

At his daily news briefing, coalition spokesman Dan Senor confirmed that the deal is in place.

"As soon as the Iraqi security forces have assumed responsibility for public security, and re-establish law and order, coalition forces will reposition to their bases outside Najaf," he said. "While maintaining protective units at the CPA offices and the government building and Iraqi police stations. Until that time, coalition forces will suspend offensive operations but will continue to provide security by carrying out presence patrols. Throughout the process, coalition forces will retain the inherent right of self-defense."

Mr. Senor called the arrangement a good first step.

Moqtada al-Sadr has offered ceasefire deals before, but the U.S. military largely dismissed them, insisting that he surrender to Iraqi authorities, and disarm and disband his fighters.

It is not clear what prompted the 30-year-old cleric to offer another deal at this time. But it is widely believed that senior Shiite cleric, Grand Ayatollah Ali al-Sistani, played a key role in arranging the truce.

The Najaf-based cleric had earlier warned Moqtada al-Sadr's militia and U.S. troops that the fighting near some of Shiite Islam's holiest shrines was not acceptable.

Iraq's national security adviser, Mouwafak al-Rubaie, earlier read a list of proposals, he says Moqtada al-Sadr made to coalition forces aimed at ending weeks of bitter fighting between the his militiamen and U.S. troops across South-central Iraq.

Mr. Rubaie says Mr. Sadr has agreed to withdraw all of his Mahdi Army militiamen from Najaf, except for those who normally live in the city, and to allow Iraqi police and security forces to move in to restore order.

But Mr. Rubaie also says Moqtada al-Sadr's offer had another condition. He says the cleric wants the coalition to suspend an Iraqi warrant for his arrest in connection with the murder of a Shiite rival last year.

The coalition has not agreed to that, but the two sides have taken the first steps toward restoring peace in the city anyway.

Several Shiite members of Iraq's Governing Council traveled to Najaf. They say they were there to help negotiate the agreement because, in their view, a regional peace deal would be a major step toward ensuring a smooth transition on June 30, when a new interim government takes power in Iraq.

Moqtada al-Sadr launched his rebellion in early April after American troops charged the preacher with inciting violence against coalition forces and arrested one of his top aides.

Fighters loyal to Moqtada al-Sadr swept through the holy cities of Najaf and Karbala, seizing city centers, police stations, and other key buildings. They also began using mosques and holy shrines to mount attacks against U.S. troops, angering religious leaders and other Iraqi Shiites who demanded the withdrawal of the al-Sadr militiamen and U.S. forces.