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Iraqis will choose a 275-member National Assembly, which is expected to draft a constitution, and governing councils in the 18 provinces. Voters in the Kurdish-ruled area in the north will elect a regional parliament.
Radicals opposed to the elections, however, have threatened to attack anyone who votes.
The Al Qaeda outfit in Iraq led by Abu Musab al-Zarqawi warned Iraqis that they could get killed if they approach polling stations, "the centers of atheism and of vice."
"We have warned you, so don't blame us. You have only yourselves to blame," said the message posted on a radical Islamic website.
The warning came shortly after Interim Deputy Prime Minister Barham Saleh announced the capture of three senior al-Zarqawi aides and predicted that the militant leader himself would soon be caught.
The majority Shias are expected to disregard extremist threats and vote. But the Sunnis, however, may follow boycott calls issued by some of their leaders or stay away fearing violence, which has been at its worst in the mainly Sunni regions north and west of Baghdad.
On Friday, insurgents hit designated polling booths across the country, including schools in Kirkuk and Beiji, north of Baghdad. A policeman was killed in Kirkuk, while two women and two children were injured when a school in Ramadi was shelled.
A suicide car bomb attack at a power station in the southern Baghdad killed four people, while five US soldiers and six Iraqis were killed in a string of attacks on Friday.
Two US soldiers were killed when their Kiowa observation helicopter crashed on Friday evening in southwest Baghdad, the US military said on Saturday. "The cause of the crash has yet to be determined," a military statement said.
At least 54 Iraqis and 15 US troops have been killed in insurgent attacks since Wednesday.
A helicopter crash also killed 30 US Marines and one sailor on Wednesday, the deadliest single incident of the war for the US military.