By Susan Cornwell

WASHINGTON, Nov 1 (Reuters) - Sen. Hillary Clinton signed a letter to President George W. Bush on Thursday warning he has no authority from Congress for an attack on Iran, setting off a new round of fighting with Democratic presidential rival Barack Obama.

Clinton, battered in a debate earlier this week for backing a resolution labeling an Iranian military unit a terrorist group, joined 29 other senators in signing a letter expressing concern about "provocative statements and actions" toward Iran by the Bush administration.

Democratic presidential rival Chris Dodd of Connecticut signed the letter, but rivals Obama of Illinois and Joseph Biden of Delaware did not.

Obama instead introduced a binding Senate measure nullifying the earlier resolution. His campaign accused Clinton of using the letter to adjust her stance on Iran.

"While she's trying her best to change her position on yet another critical issue facing our country, Senator Obama knows that it takes legislation, not letters, to undo the vote that she cast," Obama spokesman Bill Burton said.

The vote by Clinton, who leads national opinion polls in the Democratic race ahead of the November 2008 election, has become a major focus of her Democratic rivals trying to close the gap in the presidential race.

They said the resolution would embolden Bush to wage war against Iran, but Clinton said she was simply supporting a more vigorous diplomacy to rein in Iran's nuclear program.

Clinton, of New York, was the only senator running for president to support the measure. Dodd and Biden voted against it, while Obama did not vote. Clinton's campaign questioned why Obama would not sign the letter.

Spokesman Phil Singer said if Obama "isn't just playing politics" and really believed the resolution gave Bush a blank check for war "he would have signed the letter today and would have fought to stop the resolution before it came up for a vote."

Burton, Obama's spokesman, said a binding resolution was a better solution than a letter. He said there were no co-sponsors yet for the resolution, which was introduced on Thursday.

Sen. Jim Webb, a Virginia Democrat and former secretary of the U.S. Navy, drafted the letter and signed it, then gathered the signatures of 28 other Democrats and one independent.

The letter stressed no congressional authority exists for action against Iran -- and said the resolution the Senate passed in September, urging Bush to declare the Iranian Revolutionary Guard Corps as a foreign terrorist group, should not be seen as a predicate for a military strike.

A recent increase in angry rhetoric between the United States and Iran has prompted speculation of possible U.S. military action.

Bush has suggested a nuclear-armed Iran could lead to World War Three, and last week he dubbed the Iranian Revolutionary Guard Corps as a proliferator of weapons of mass destruction and imposed sanctions on its Qods force.

White House National Security Council spokesman Gordon Johndroe said officials there had not yet seen the senators' letter.

"President Bush is focused on a diplomatic solution to Iran's refusal to comply with the will of the international community, but it's never prudent policy to take any options off the table," he said.

Biden spokeswoman Elizabeth Alexander said he had voted against the resolution because he believed it could be used by Bush to justify military action against Iran -- and so did not need to clarify his position in a letter.

Obama said in an interview with The New York Times that if elected president he would "engage in aggressive personal diplomacy" with Iran, offering it economic inducements and a possible promise not to seek "regime change" if Tehran stopped meddling in Iraq and cooperated on terrorism and nuclear issues.

He made clear he intended to talk to Iran without preconditions and said "changes in behavior" by Iran could possibly be rewarded with membership in the World Trade Organization. But he declined to say if he would consider military action if Iran did not abandon its presumed nuclear weapons program. (Additional reporting by John Whitesides)

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