Ayatollah Ali Sistani, Iraq's leading Shia cleric, has condemned as "fundamentally unacceptable" US plans to appoint rather than elect the Iraqis who will begin drafting a new constitution.
His fatwa, published in Baghdad newspapers on Tuesday, carries enormous moral weight for the majority Shia community which has been excluded from political power for decades.
It also complicates the efforts of Paul Bremer, the US-imposed administrator, who intends to name a hand-picked "governing council" of about 30 members in a fortnight.
Ayatollah Sistani is seen as a moderate leader who believes that religious leaders should remain aloof from politics.
"The occupation officials do not enjoy the authority to appoint the members of a council that would write the constitution," Ayatollah Sistani said in the fatwa. "There is no guarantee that this council would grant a constitution that accorded with the highest interests of the Iraqi people and would express their national identity, among the pillars of which is the foundation of the pure religion of Islam and noble social virtues," he added.
He called for a general election "so that every eligible Iraqi can choose someone to represent him at the constitutional convention that will write the constitution. Then there must be a public referendum. It is incumbent upon all believers to demand the realization of this important matter, and to join together in achieving it," he said.
Until now, the ayatollah's post-war pronouncements have dealt with public morals.
He called on Iraqis to stop looting and avoid revenge killings. In May he issued a fatwa calling on Iraqis not to join political parties because their agendas were not yet clear.
Ayatollah Mohammed Baqir al-Hakim, the leader of the Supreme Council for the Islamic Revolution in Iraq (Sciri) also criticized Bremer this week. Sciri had regular talks with the Bush administration but a gap has emerged recently.
"Our demand is that a government be formed by Iraqis and work to end the occupation by peaceful means," Ayatollah Hakim said.
Last night US officials were trying to put a brave face on the challenge from the ayatollahs.
Americans have become uneasy about the rising casualty rate among US forces in Iraq, a poll published on Tuesday showed.
Although a majority believe it was right to go to war, support has declined steadily since April, when confidence in President George W. Bush and America's project in Iraq peaked.
Fifty-six per cent of Americans believe events are going well for the US in Iraq in the poll commissioned for USA Today, CNN and Gallup.
That represents a slide from 86 percent in early May, when President Bush declared an end to combat, and 70 percent a month ago.
"Americans like their wars to be won, and to be won quickly, and then they want an exit strategy," said John Zogby, an independent pollster.
"The afterglow is over, and I think from here on in, he [President Bush] starts to worry."