By Alastair Macdonald and Paul Holmes

BAGHDAD, Nov 5 (Reuters) - The U.S. ambassador urged Iraqi leaders to seize their opportunities as, two days before U.S. elections dominated by Iraq, Americans are doubting Washington's strategy because of the sectarian "killing of the innocent".

After President George W. Bush said last month that the patience of the United States was "not unlimited" for giving military and economic support to Iraq's government, envoy Zalmay Khalilzad told Reuters he saw the crucial reason as the mounting communal bloodshed that Iraq's leaders have failed to stem.

In an interview late last week, before Saddam Hussein was sentenced to death on Sunday for crimes against humanity, the ambassador acknowledged some powerful figures in Iraq seemed still committed to promoting sectarian interests by force.

"There are some in Iraq, on all sides, that do not believe in reconciliation," he said.

Bush said he would not leave the 150,000 U.S. troops in Iraq in the crossfire of a sectarian civil war, suggesting a race against time for Iraqi leaders to bring the conflict under control or face a possible withdrawal of American backing under pressure from disillusioned voters in the United States.

Khalilzad noted Prime Minister Nuri al-Maliki had agreed to "timelines" for political change that could help demonstrate progress. He put down a recent public spat with Maliki partly to translation problems that led the Iraqi premier to fear Washington was setting him "deadlines" for action, for example, against militias led by powerful fellow Shi'ite Islamists.

There was also an element of domestic politicking in Iraq, Khalilzad said. And Maliki had genuine demands for accelerating the training of Iraqi forces, the transfer units to his, rather than U.S., command and establishing overall Iraqi control.

Under an agreement struck by Bush and Maliki a week ago, a committee of top Iraqi and U.S. officials is working this month to speed up those three elements: "Plans have been in place," the envoy said. "We are reviewing whether we can move some of the timelines leftward to make them happen sooner."

In an interview with Reuters 10 days ago, Maliki blamed U.S. policy for the turmoil in Iraq and said he could restore order in just six months if his forces had more training and weapons.

AMERICAN DOUBTS

The United States remained committed to fighting insurgents among Saddam Hussein's fellow minority Sunnis -- also a militia -- Khalilzad said, as he dismissed Shi'ite complaints that it now favoured Sunnis because of fears of Shi'ite ties to Iran.

"The American people know that this is very difficult; at the same time, very important," the ambassador said against the background of elections on Tuesday that could cost Bush's Republicans control of Congress because of a backlash over Iraq.

"But the recent sectarian bloodshed in Iraq causes many to question whether the United States and the Iraqis can succeed.

"What is causing us difficulty in terms of public support, particularly in recent times, has been that Americans do not understand the sectarian violence, the killing of the innocent.

"Why kill someone because of his identity?"

Nonetheless, Khalilzad said: "Despite the difficult challenges we face, success in Iraq is possible.

"The Iraqi people have a great opportunity. For the sake of the people of Iraq and for the sake of the future of this region, I think the leaders need to rise to the occasion and grab it," he said, noting that mass turnout in last December's election showed "the people have risen to the occasion".

Khalilzad welcomed a commitment by Maliki, in a recent joint statement with the ambassador, to timelines for assessing progress toward various objectives, including resolving disputes over the constitution and disbanding unofficial armed groups.

The public row between Baghdad and Washington, which raised new questions about Iraq strategy during the election campaign, was partly caused by miscommunication, Khalilzad said:

"Part of it has been the issue of translation. There has been a concern that some sort of a deadline was being set for this government to do certain things," he said. "Iraqi leaders agreed to resolve important outstanding issues with a schedule."

He dismissed suggestions by Shi'ite leaders that the U.S. focus on disbanding militias blamed for hundreds of "death squad" killings every week implied a swing against the Shi'ites by the U.S. administration, in favour of Saddam's fellow Sunnis.

"I treat the Sunni insurgents as another militia," said Khalilzad, whose own Sunni Muslim roots in Afghanistan are the cause of some Shi'ite suspicion.

"Both have to be brought down because otherwise the Shi'a will not agree with their militias being brought down. Everyone needs to unite against the terrorists and the Saddamists."

He said U.S. attempts to persuade Sunni fighters to lay down their arms and join the political process were in the interests of the Shi'ite majority. "What we're doing is reconciling the Sunnis to the new order," he said.

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