BAGHDAD, Iraq, AP – U.S. and Iraqi troops battled insurgents house-to-house on Monday, the third day of a major offensive against al-Qaida insurgents in a town near the Syrian border, and the U.S. command reported the first American death in the operation.

The U.S. commander of the joint force, Col. Stephen W. Davis, told The Associated Press late Sunday that his troops had moved &#34about halfway&#34 through Husaybah, a market town along the Euphrates River about 200 miles northwest of Baghdad.

At least 36 insurgents have been killed since the assault began Saturday, and about 200 men have been detained, Davis said. He did not give a breakdown of nationalities of the detainees. Many were expected to be from a pro-insurgent Iraqi tribe.

A Marine was killed by small arms fire in Husaybah on Sunday, the military said. The New York Times, which has a journalist embedded with the U.S. forces, reported that three Marines were also wounded Sunday.

The death raised to at least 2,046 the number of members of the U.S. military who have died since the beginning of the Iraq war in March 2003, according to an Associated Press count.

CNN, which also had a reporter accompanying the offensive, said at least one Iraqi soldier has been wounded and that as many as 80 insurgents have died in the fighting.

In a live report from the scene Monday morning, CNN said the house-to-house battles were continuing, with ground forces supported by Humvees and tanks working their way through the narrow streets of the bleak desert town.

Scores of terrified Iraqis fled the besieged town on Sunday, waving white flags and hauling their belongings.

The U.S. military announced Monday that it had killed two regional al-Qaida in Iraq leaders operating in the Husaybah area during air strikes that destroyed several insurgent &#34safe houses&#34 on Oct. 31 near the towns of Karabilah and Obeidi.

It identified one of them as Abu Umar, who helped smuggle foreign insurgents into the region and stage deadly roadside bomb attacks against Iraqi and American forces. The other militant was identified as Abu Hamza, who commanded several al-Qaida cells and helped launch attacks against coalition forces, including ones based at U.S. Camp Gannon in the Husaybah area, the military said.

Davis said the militants were putting up a tough fight in Husaybah because &#34this area is near and dear to the insurgents, particularly the foreign fighters.&#34

Speaking by telephone, he said: &#34This has been the first stop for foreign fighters, and this is strategic ground for them.&#34

The U.S. Marines said American jets struck at least 10 targets around the town Sunday and that the American-Iraqi force was &#34clearing the city, house by house,&#34 taking fire from insurgents holed up in homes, mosques and schools.

Residents of the area said by satellite phone that sounds of explosions diminished somewhat Sunday, although bursts of automatic weapons fire could be heard throughout the day. The residents said coalition forces warned people by loudspeakers to leave on foot because troops would fire on vehicles.

&#34I left everything behind — my car, my house,&#34 said Ahmed Mukhlef, 35, a teacher who fled Husaybah early Sunday with his wife and two children while carrying a white bed sheet tied to a stick. &#34I don”t care if my house is bombed or looted, as long as I have my kids and wife safe with me.&#34

The Marines said in a statement that about 450 people had taken refuge in a vacant housing area in Husaybah under the control of Iraqi forces. Others were believed to have fled to relatives in nearby towns and villages in the predominantly Sunni Arab area of Anbar province.

U.S. officials have described Husaybah, which used to have a population of about 30,000, as a stronghold of al-Qaida in Iraq, which is led by Jordanian extremist Abu Musab al-Zarqawi.

Husaybah had long been identified as an entry point for foreign fighters, weapons and ammunition entering from Syria. From Husaybah, the fighters head down the Euphrates valley to Baghdad and other cities.

Several people identified as key al-Qaida in Iraq officials have been killed in recent airstrikes in the Husaybah area, the U.S. military has said. Most were described as &#34facilitators&#34 who helped smuggle would-be suicide bombers from Syria.

Damascus has denied helping militants sneak into Iraq, and witnesses said Syrian border guards had stepped up surveillance on their side of the border since the assault on Husaybah began.

The Americans hope the Husaybah operation, codenamed &#34Operation Steel Curtain,&#34 will help restore enough security in the area so the Sunni Arab population can participate in Dec. 15 national parliamentary elections.

If the Sunnis win a significant number of seats in the new parliament, Washington hopes that will persuade more members of the minority to lay down their arms and join the political process, enabling U.S. and other international troops to begin withdrawing next year.

However, a protracted battle in Husaybah with civilian casualties risks a backlash in the Sunni Arab community, which provides most of the insurgents.

On Sunday, Mohsen Abdul-Hamid, head of the largest Sunni Arab political party, Saleh al-Mutlaq, head of another Sunni faction and a member of the committee that drafted the new constitution, both sharply criticized the offensive, saying it was targeting civilians.

The U.S.-led assault includes about 1,000 Iraqi soldiers and will serve as a major test of the fledgling army”s capability to battle insurgents — seen as essential to enabling the Bush administration to draw down its 157,000-strong military presence.