(Updates with Saakashvili quote)

By Matt Robinson

GORI, Georgia, Aug 14 (Reuters) - Georgian officials and Russian soldiers faced each other at the frontline on Thursday to negotiate the handover of a strategic town plagued by looting.

Georgian forces, who abandoned the area three days ago, are anxious to get back following accounts by human rights groups and refugees of widespread looting by marauding militia in Georgian villages north of the town.

Flanked by plainclothes guards and wearing body armour, Georgia's security council secretary Kakha Lomaia met the commander of the Russian soldiers who the day before had driven into Gori, 60 km (35 miles) from the Georgian capital.

"We're trying to arrange a peaceful pullout of the Russian army," Lomaia told journalists before driving off with Russian army officers in an off-road vehicle towards Gori.

Russia supported separatists in the breakaway region of South Ossetia, north of Gori, in a war against Georgia which flared last week. Moscow says its soldiers entered Gori on Wednesday, barely 24 hours after a ceasefire, to destroy Georgian military equipment and secure a nearby arms depot.

Russian tanks blocked roads into the town on Thursday and soldiers stood watching, smoking cigarettes. Underlining the sense of lawlessness, a hidden gunman fired a shot at a Georgian reporter speaking to camera, the bullet grazing her arm.

Russian forces bombed Georgian military positions around Gori last weekend, also hitting an apartment block. On Thursday, the town was practically deserted, only elderly people left milling around the main square.

Despite Georgian assertions that Russian forces had destroyed the city, there was little damage to the buildings.

But there were signs of looting which locals blamed on militia out of Russian control. Shops had been smashed up and there were very few parked cars.

"They were stealing cars and breaking into shops," Vasily, 72, said. "They spoke Ossetian." Georgian television broadcast footage from a security camera showing uniformed men smashing their way into a bank with automatic rifles.

"STATE OF LAWLESSNESS"

The Russians have pledged to stop any looting and militia activity but on Thursday men wearing an assortment of camouflage uniforms stole cars from journalists. The United Nations said men in unmarked military uniforms had hijacked two U.N.-marked vehicles in Gori.

U.N. Secretary-General Ban Ki-moon on Thursday urged "all sides to control forces under their command to ensure that the current state of lawlessness ceases."

Georgian President Mikheil Saakashvili said Russia was behind a "deliberate policy of ethnic cleansing."

"I can prove it with the international organisations already bringing testimony to what I'm saying," he said in English at a briefing for foreign media.

One Georgian official said the Russian withdrawal had been delayed.

"We had an agreement that the Russians would leave Gori at 7 a.m. (0300 GMT) today, but later they said would leave at 1 p.m.," an Interior Ministry spokesman said by telephone.

"And now they say they will leave in two or three days."

At the frontline Major-General Vyacheslav Borisov, the Russian commander, said the handover would proceed in order to restore confidence and encourage people to return.

Driving in a black Mercedes car registered in Georgia, Borisov had earlier guided a Georgian police convoy into the centre of the near-deserted town where 50,000 people had once lived. The police left after a brief tour.

Glass littered the streets around the main square of Gori, the birthplace of Soviet leader Josef Stalin and a key point on the main highway linking eastern and western Georgia. Tank tracks scarred the streets.

"It's been so difficult for the past few days but yesterday the Russians came and it has been different," said an elderly woman, who asked not to be named. (Additional reporting by Margarita Antidze; writing by James Kilner, editing by Richard Williams)

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