All signs pointed to an epic confrontation about to unfold: the constant low bass of American artillery in the darkness, the muffled shouts of Iraqi soldiers on night watch.
Dusk brought crashing volleys from Iraqi rocket launchers and artillery, secreted in alleys in the few populated enclaves of a city whose peripheries have emptied. American fighter planes rumbled overhead, seemingly impervious to Iraqi air defences.

After nibbling away at the southern edges of Baghdad, it seemed clear last night that the American army had swung into positions encircling the city, and was poised to come in. It was equally clear that the Iraqis would be waiting - determined, and in large numbers, though not in any recognisable military formation.

By day the main thoroughfares of Baghdad were swarming with troops, soldiers' helmets emerging from foxholes dug every 10 metres. Units of the Republican Guard, showing their status as Saddam Hussein's elite troops by the red triangle on their sleeves, stood at every junction.

Militiamen from the Ba'ath party puttered along in motorcycle sidecars with guns mounted on top. Young men, wearing black woollen balaclavas despite the burning summer heat, climbed into pick-up trucks with bazookas and Kalashnikovs.

By night they had hunkered down for the fight. They had cannon and multi-rocket launchers, artillery pieces and mortars. What the motley collection of troops did not appear to have were clear deployment orders. But they did have faith.

"They say the city is at their mercy. But the city does have people to defend it," insisted a purple-jacketed waiter from a city restaurant.

Barely three days after the devastating loss of Baghdad airport to the American army, the Iraqi authorities appeared to have recovered their nerve yesterday, and reasserted their iron grip on the city.

They imposed a curfew, evacuated families from the suburbs that are about to turn into war zones, and moved concrete blocks across main arteries to deny access to an invading force.

As the crackle of anti-aircraft and machine-gun fire moved closer to the centre of Baghdad, it was clear that the battle was drawing nearer.

It was also clear how it might go. The signs had been there since Saturday morning: a motorway on the southern extremities of Baghdad, dotted with the blackened carcasses of Iraqi army vehicles, gruesome souvenirs of the American army's brief jaunt through the suburbs.

That was how the US excursion ended, in clashes that brought such heavy casualties that for the first time since the war began the hospitals lost count.

"We just couldn't keep up," the director of Baghdad's main casualty ward said.

It was Baghdad's worst day, and it was compressed into just the few hours during which an exploratory column of tanks nibbled at the edges of the city before retreating.

But it was also a turning point of sorts, after the loss of Baghdad airport on Thursday night. At Daura, a suburb on the southern edge of the city, foreign journalists were taken yesterday for a tour of a burnt-out American tank, captured and destroyed, they said, by Iraqi fighters after beating back an American incursion.

Regular army soldiers and fighters from the Ba'ath party militias clambered on top of the blackened hulk, and perched on the gun barrel. The stencilled letters along its length read: COJONE EH.

"This means the collapse of the United States," crowed Lieutenant-Colonel Jassem Faisal. "They were hit, and they ran away."

A few of his pumped-up troops began firing their Kalashnikovs into the air. "This is very good for our morale," he said.

According to the confused accounts on offer, the abandoned tank was part of a column trying to enter Baghdad from the south. It was halted in its tracks by a combined force of regular army and the Republican Guard. Militias from the Ba'ath party and Arab recruits to Iraq's cause swept in, firing from motorcycle sidecars on the motorway overpass, and from the windows of a double decker bus.

The only problem with that heroic version was that the tank was pointing south - away from Baghdad - and that it had a towbar trailing from the rear.

What the Iraqis were in no mood to celebrate was the cost of engaging the Americans. The detritus of that encounter extended for two miles through the suburbs: blackened Iraqi army pick-up trucks, transport lorries, artillery pieces, shattered windows, and bullet holes peppering civilian homes.

Across the road from the tank a few children poked at the carbonised and twisted wrecks of two of the buff-coloured pick-up trucks used by the Iraqi army.

The doors opened on a pathetic stash of tomato paste and other tinned food - eaten and tossed in the back seat by the soldiers who were killed inside - and an oxygen canister from a chemical warfare kit.

There were few Iraqis to witness their last stand. Daura, like the other suburbs of Baghdad, has become a dead zone.

The streets are empty, and homes deserted. The residents of entire districts have packed up their belongings and fled, belatedly joining an exodus which began February and was complete by the weekend.

Many of the abandoned homes have been taken over by Iraqi soldiers, or armed cadres from the Ba'ath party, increasing the peril to those lonely families who have stayed.

"In our whole street, we are the only ones left," said Suad Abdul Rehman. "We didn't have a car to go earlier, and now there are no taxis. Now we have money but we can't find anything to buy - not even bread. Everything is closed down. Everyone has gone, except us."

Her husband, Dhiya Khalid Hammoudi, watched the Americans roar in at about 8am on Saturday. He said he saw a column of 25 tanks and armoured vehicles drive along the motorway skirting Daura for about a mile.

The column paused at the vegetable market, mowing down two more Iraqi army pick-up trucks.

"They came in just to find out, just to feel what the situation is like," he said.

But it could be very different the next time the Americans come.