MEDELLIN, Colombia (Reuters) - Colombian grocer Juan Aristizabal says he'll miss the far-right death squads that ruled his poor neighborhood with an iron fist.

Without the 850-odd gunmen of the Cacique Nutibara Block, who agreed to disband on Tuesday under a government peace initiative, Aristizabal wonders what will stop Marxist rebels from swarming into the urban sprawl of eastern Medellin.

"The boys took care of the area, protected us. We helped them with money. God willing, the guerrillas won't come looking for revenge," he said, speaking timidly.

Breaking up the Nutibara, which controlled Medellin's slums, was the first result of President Alvaro Uribe's controversial peace negotiations with far-right paramilitaries. The outlaws will attend a three-week rehabilitation camp, and then take courses on how to rejoin society as civilians.

While human rights groups say the peace initiative will let killers and drug traffickers get away scot-free, thousands of Colombians like Aristizabal are more concerned about their own security if the gunmen do indeed retire.

And fears extend beyond Medellin. The government hopes for the prompt dissolution of the Nutibara's parent organization, the 13,000-strong United Self Defense Forces of Colombia, or AUC, which has pushed back rebels across the country using brutal tactics that have earned it the "terrorist" label in the United States.

MAKE-OR-BREAK MILITARY TEST

"This is a big challenge for the government and its policy to guarantee security for the whole country," said military analyst Alfredo Rangel.

"If the armed forces can't contain the guerrillas, then they (the rebels) will be strengthened and recover strategic positions," Rangel added.

Courts have proven the far-right paramilitaries, who have their origins in vigilante groups set up by cattle ranchers and drug traffickers, have often cooperated with sectors of the armed forces in a dirty war against Marxist guerrillas.

Authorities promise extra police to provide security in the Nutibara's old territory.

But, if rebels rush in to fill the paramilitary vacuum in the slums of Medellin, it could make other AUC units reluctant to disband and raise questions about Uribe's security policies.

The president has boosted defense spending to ensure security forces are present in even the most remote villages. He is negotiating with the paramilitaries, but has warned 20,000 Marxist rebels he will defeat them on the battlefield if they do not lay down their arms after four decades of a war that claims thousands of lives a year.

Citizens like Aristizabal saw the right-wing gunmen as a necessary evil.

But skeptical Colombians, fearing paramilitaries are here to stay, wonder whether the Nutibara's disarmament was mostly symbolic.

Newspaper El Tiempo interviewed the mother of one fighter, named Carlos, who only joined the Nutibara three months ago -- after hearing about the demobilization program's economic rewards.

Nutibara leader Diego Murillo, alias "Don Berna", is described by U.S. officials as one of Colombia's biggest drug traffickers and remains on the run.

Still, El Tiempo said in an editorial it hoped any nagging questions about the disarmament would be quickly put to rest.

"There are so many lingering doubts about the process and it is vital they be resolved. For Medellin, for the country, and for the sake of any eventual exit to the conflict."