(Adds Diyala battle)

By Kristin Roberts and Aseel Kami

BAGHDAD, Dec 6 (Reuters) - Al Qaeda remains a dangerous foe in Iraq despite a decline in violence, the commander of U.S. forces in Iraq said on Thursday, a day after the deadliest bombing in Baghdad since September.

Northeast of Baghdad, up to nine Iraqi security forces personnel were killed in a gun battle with suspected al Qaeda fighters in Diyala province, security officials said.

Violence has fallen across Iraq but U.S. commanders say regions north of Baghdad, such as Diyala, remain at threat after security crackdowns this year squeezed al Qaeda and other fighters out of Baghdad and western Anbar province.

"We have to be careful not to get feeling too successful," General David Petraeus said before he met visiting U.S. Defense Secretary Robert Gates on Thursday, a day after a car bomb killed 15 people in the worst attack in Baghdad since September.

"We see this as requiring a continued amount of very tough work. We see al Qaeda as a very, very dangerous adversary still able to carry out attacks and an adversary that we must continue to pursue," Petraeus told reporters.

He said the Sunni Islamist militants were likely to attempt spectacular attacks in a push against U.S. and Iraqi forces.

A militant group linked to al Qaeda in Iraq issued a threat on the Internet earlier this week vowing to launch a wave of car bomb attacks and strikes on Iraqi security forces.

In Diyala, nine Kurdish troops were killed when suspected al Qaeda gunmen attacked an Iraqi army checkpoint, police said. The victims were initially identified as policemen but police later said they were Kurdish soldiers.

A spokesman for the Kurdish Peshmerga forces from Iraq's largely autonomous region of Kurdistan said eight Peshmerga troops were killed. Three gunmen were killed, he said.

SHATTERED GLASS

In central Baghdad's prosperous Karrada neighbourhood, shopkeepers swept up broken glass after a car bomb killed 15 people and wounded 35 on Wednesday, across the Tigris River from the "Green Zone" compound where Gates met Iraqi officials.

With signs of normal life returning, defiant Baghdadis have ignored the destruction to return to Karrada's boutiques.

"That? That was just one explosion," said Um Fadhil as she tried on boots with her two teenaged daughters at a shop just 100 metres from the blast site. "No, I am not afraid."

Perfume shop owner Abu Hiba said life and business would go on. "Attacks like these are the final throes of a dying bull."

The Karrada blast was among four across in central and northern Iraq on Wednesday which killed a total of 23 people.

Violence across Iraq has fallen to its lowest level since the bombing of a Shi'ite shrine in Samarra in February 2006 unleashed reprisal attacks which threatened sectarian civil war.

With attacks down 55 percent since a "surge" of 30,000 extra U.S. troops became fully deployed in mid-June, Gates sounded an optimistic note after his meetings with Iraqi officials.

"I came away with a sense that there is growing pressure from below for the top levels of the government to replicate the kind of reconciliation that's going on in a variety of other places in Iraq," Gates told reporters in Bahrain.

Along with the extra troops, credit for the decline in violence has also been given to the growth of U.S.-backed neighbourhood security patrols organised by mainly Sunni Arab tribal sheikhs who have turned against al Qaeda.

But Washington has also been frustrated by the Shi'ite-led government's slow progress on political reforms meant to reconcile Iraq's minority Sunni Arabs and majority Shi'ites.

"What was interesting in meeting both with the prime minister and the presidential council is they know what they need to do and they know that people are getting impatient and that they need to get on with legislation," Gates said. (Additional reporting by Mussab Al-Khairalla and Peter Graff in Baghdad; Writing by Paul Tait and Peter Graff)

AlertNet news is provided by