BAGHDAD .- I've moved out of the Palestine Hotel after living there all year because it has come to represent America's frustrations and lost hopes in Iraq and was quite depressing. I moved also because I was tiring of watching the concrete security walls rising higher and higher around the hotel --- and having to deal daily with increasingly jumpy guards.

And yet six months ago I watched as the Palestine became a scene of unbridled joy as happy Iraqis toppled the bronze statue of Saddam Hussein in the adjoining Paradise Square. The first US soldiers on the scene were showered with flowers and handshakes. The hotel was open to all-comers, and the locals came to meet the American liberators.

For many reasons, that initial joy has dissipated into resentment and mutual suspicion between the American military in Baghdad and many of the local population. That is why the concrete walls are going up around the Palestine Hotel and every other US installation in the city. And that is why increasing questions are being raised by Iraqis about the need for more foreign troops here.

Even the American-appointed Iraqi Governing Council is arguing that there are enough foreigners here already, and that no more are needed, particularly the planned deployment of 10,000 Turkish troops that Iraqi Kurds in particular oppose.

More and more people are pointing to the local resistance of the British military occupation of Iraq after World War 1 as the historical model to follow. The Iraqis want more local police and the training of a genuine national army, even if that means bringing back into service former members of the Baathist regime. And they want to take political control of their country now rather than much later as the Americans envisage.

Any new foreign forces sent to Iraq will have to face the reality of a population increasingly hostile to occupation, and that includes the potential deployment of South Korean troops. For the American soldiers in Iraq and to some degree the British and the Polish forces in the south of the country, each day brings greater threat rather than less.

So far more than 100 US soldiers have been killed in action since President Bush declared the war officially over on May 1. That is twice the number killed in the war itself, a situation helping make Iraq an increasing liability to the Bush administration's political fortunes. Senior US generals agree that the resistance/terrorist forces opposing them are becoming more bolder and sophisticated.

That is why concrete is becoming the commodity of necessity, huge blocks of it protectively encircling barracks and bases. This is a far cry from original American assumptions that a welcoming population would prove cooperative. And concrete walls do not make for good relations with your neighbors, or winning their hearts and minds.

Living in the Palestine is typical of the environment for foreign and personnel in embattled Iraq. It is like living in a prison, with armed men in the elevators, the dining rooms and the lobby. The parking lots are empty expanses of concrete because of the fear of car bombs. After all, a dozen foreign targets have been bombed in Baghdad in the past six weeks.

The tension is enhanced by a palpable sense of unease pervading everywhere. At dinner in the hotel the other night a well-known British security expert working for a large American construction company came over to my table and told me his theory of "creeping death." Earlier that day two suicide bombers had made a desperate attempt to blow up the nearby Baghdad Hotel which housed American security and government personnel.

"We're next," the expert stated matter-of-factly. "There is clearly a determination by the resistance -- whoever it is -- to undermine the foreign effort in Iraq by any means possible. How do you stop a suicide bomber? You can't. It is creeping death for all of us here."

I can understand the security expert's pessimism. He is responsible for the safety of hundreds of Americans and others working on the Iraqi reconstruction effort, so it is better to paint a black picture than a rosy one. But I didn't stay around the Palestine to see if he was right or wrong.

I was personally reluctant to move from the hotel. I left a lot of memories behind there. It was from the roof of the hotel that I covered live the first half of the recent Gulf War for NBC, including the opening "shock and awe" bombing campaign against Saddam's palaces just across the Tigris river. I was eventually fired by NBC for criticising the American war effort, but I went on to report the news for several other media outlets.

I was also at the Palestine when an American tank crossing the nearby Jumhariya bridge April 8 fired a shell at the hotel, striking the Reuters bureau on the 17th floor and killing two journalist colleagues, cameramen Taras Protsyuk and Jose Couso. The US authorities have still not given a satisfactory accounting for their deaths.

By moving out of a hotel and into the Iraqi neighborhoods I gave up the small luxuries such as laundry and room services. But the advantage is that not only did I get greater freedom of movement but it enables me to get a clearer picture of what is going on amongst the local population.

I have rented a small house on a quiet street in the Karada district of the city near the east bank of the Tigris river. My Iraqi landlord lives next door and is a beekeeper with a farm outside Baghdad. He has a wife and a young daughter, and there is a second child due in the next month or so. My other neighbor is Lebanese businessman who has been here for years.

The Karada district where I live is a relatively prosperous business area, and most people here seem to have a vested interest in the success of the US Government's material and political reconstruction effort. But even here the ambivalence is apparent, the desire for security, political legitimacy and prosperity on one hand, yet an urgent need for independence on the other. The Iraqis believed in America promises of democracy and they want it now.

"Of course US troops are needed now, but not here in Baghdad, not in our faces," said Malik Zubeidi, a business leader here. "Americans should leave the city policing up to Iraqis and stay in the countryside, protecting our borders and so on. The war is still on because the Americans and other foreigners are so visible to everyone."

The dangers of foreign involvement in the local affairs of Iraqi communities are clearly apparent in three explosive locations, the sunni city of Faluga west of Baghdad, the Baghdad suburb of Sadr City, and the shiite center of Kerbala to the south. I visited Faluga the other day and what I saw reminded me of American military operations in Vietcong areas in Vietnam thirty five years ago. This area is known as "the sunni triangle" an echo of the name the Americans gave to a vietcong area north of Saigon, "the iron triangle".

At Faluga, US forces were cautiously patrolling main streets, poking at roadsides looking for hidden mines and explosives. Helicopters whirred watchfully overhead as the local population sullenly looked on. More than a dozen Americans soldiers have been killed in Faluga since May and the situation remains tense because many locals have been killed on skirmishes.

At the edge of town on the banks of the Euphrates river, a newly-mounted picture of Saddam Hussein had been pasted on an old billboard where a grand portrait of the former Iraqi leader had previously been scratched out. Faluga is one Iraqi city where the influence of Saddam remains considerably significant. Many in Faluga served in Saddam's intelligence and military forces.

The anger against Americans crosses religious boundaries. It was displayed a week or so ago in Sadr city in Baghdad, a slum area formerly known as Saddam City. This is an area where the numerous portraits and statues of Saddam Hussein have been replaced with representations of shiite saints and contemporary leaders. One of these murals is a huge billboard at the traffic circle at Workers Square painted with the faces of Muhammad Baqr al-Sadr, and Muhammad Baqr al-Sadr, an islamic scholar.

The burst of violence in Sadr City is a cautionary tale for all foreign troops in Iraq. It was sparked by

followers of a young anti-American shiite cleric named Moktada al-Sadr. His father and uncles had been murdered by Saddam Hussein, and it was their faces painted on the Worker's Square billboard. The young Moktada has emerged as a charismatic new leader, challenging the conservative shiite old guard.

The spark for the incident was a terrorist attack on an Iraqi police station in Sadr city in which a bomber crashed through the gate in a car and detonated a powerful bomb, killing eight other people. Several hours later US troops surrounded Moktada al-Sadr's headquarters a few blocks away, entering and then forcefully disarming those within.

After the Americans left local militia forces blocked off the street and people began assembling. A US patrol returned and was attacked by the crowd who claimed the shiite headquarters had been violated. In the melee that followed two Americans were killed along with two Iraqis. At friday prayers the next morning, coffins with the Iraqi remains were paraded through Sadr City.

I've interviewed a senior aide to the cleric, Sheik Abdel Hadi al-Daraji, in Sadr City and he makes no secret of his virulent anti-Americanism."America is nothing but a terrorist organization that is leading the world with its terrorism and ignorance, but yet it calls itself a supporter of democracy," declared the bearded cleric. "I say no, no to American aspirations in Iraq, I say to the Americans go home."

Even more potentially explosive is the shiite religious city of Kerbala with its towering golden mosques and fervent religious followers. I've visited the shiite city of Kerbala many times over the years, and it remains for the Americans as much a hotbed of potential unrest as it did for Saddam Hussein. Unlike the sunni Saddam who ruthlessly suppressed a shiite rebellion in Kerbala after the first Gulf War, and slaughtered thousands in later religious pogroms, the Americans are just trying to keep order.

But keeping order is difficult because some of Islam's major shiite shrines are in Kerbala, and they have attracted a plethora of activisit religious organizations, some adhering to Iran's more fundamentalist views of shiasm. It is into this quagmire that the christian American soldiers move at their peril, as was recently shown when three US soldiers were killed in a religious skirmish during Friday prayers.

A long-time acquaintance of mine, the journalist Karim Kobar, is convinced that there will be civil war in Iraqi within six months between the fueding shiite factions, the sunnis and the kurds. Prior to this year's war many experienced academics predicted that the most difficult hurdle a new Iraq would face would be religious strife. This is only now beginning to happen.

My friend Karim sees US forces and other foreign troops here becoming embroiled in the civil strife as they seek to restore order. "They'll be sucked in and spat out. It will be nasty," Karim predicts.

Already, even the mild-mannered Polish military continguent that has managed to stay out of the headlines, has had its troubles. The Poles were on a routine patrol in Abu Al Wan village near Hilla south of Baghdad one morning when a soldier saw a man moving, and panicked and shot him dead. In fact, the man was the security guard of the local medical clinic.

The brother of the dead man, Shehab Hamid, complained to reporters that,"the coalition forces have never been attacked in this town, so why did they treat us so badly? Why this random killing of innocents?"

Polish authorites responded that their soldier over-reacted to a potential threat. But the villagers vowed revenge.

It is this cycle of killing and revenge that has bedevilled the American military effort in Iraq. And the potential for more of the same remains considerable.

The next focus of major concern could be the northern region centered on the city of Mosul, an area long coveted by neighboring Turkey. The US Government has persuaded Turkey to send 10,000 troops to help pacify Iraq, particularly in the "sunni triangle" west and north of Baghdad. But clearly the Turks will also be focussed on Mosul, and on the large Kurdish population that lives in the city and to the region northwest along the Iranian and Turkish borders.

Iraq's Kurdish population has been enjoying autonomy, but Turkey is known to fear the possibility of the Kurds eventually winning their own state, something that could trigger serious repercussions on the Kurdish regions of Turkey. The arrival of Turkish troops could possibly make Mosul a powderkeg, not just for the Turks but also for any other foreign troops sent there.

With the potential for trouble in almost every corner of Iraq, the United States is breathing a sigh of relief that it was able to win United Nations support for a new security council resolution that may bring more money and support from countries that previously were unwilling to help.

For my neighbors at my new home in Karada, however, these big political issues are less significant than the daily grind of living. A week ago the US High Command in Iraq announced that more electric power was now available than in any previous time. However, in my first two days in my new house power was available only for five hours out of 48 --- hardly calling for a vote of confidence in the abilities of the regime.