The Bush administration is undercutting its "war on terrorism" by embracing a Libyan regime that plotted a year ago to assassinate the ruler of Saudi Arabia. New revelations make clear how serious that Libyan plot was, but, strangely, it has gone almost unmentioned publicly by an administration eager to claim success for its anti-terrorism policy.

President Bush has often cited Libya's announcement last December that it would stop trying to build nuclear weapons as evidence that the invasion of Iraq has deterred other nations from terrorism. "By speaking clearly and sending messages that we mean what we say, we've affected the world in a positive way," Bush said in the first presidential debate.

"Look at Libya," Bush continued. "Libya was a threat. Libya is now peacefully dismantling its weapons programs. Libya understood that America and others will enforce doctrine, and the world is better for it."

Vice President Cheney echoed that theme in his debate with Democrat John Edwards. "One of the great byproducts, for example, of what we did in Iraq and Afghanistan is that five days after we captured Saddam Hussein, Moammar Gaddafi in Libya came forward and announced that he was going to surrender all of his nuclear materials to the United States, which he has done," Cheney said.

But in November 2003, at the very time that top Libyan officials were negotiating with U.S. and British diplomats the details of a supposed renunciation of terrorism, Libyan operatives were recruiting a hit team to kill Saudi Crown Prince Abdullah and destabilize the oil-rich kingdom. Had the plot succeeded, it might have had a disastrous impact on the global economy.

"The administration is engaging in a cover-up here," argues G. Henry M. Schuler, a Libya expert who has been studying that country for more than 30 years. He contends that the comments by Bush and Cheney are a continuation of the confusing signals that have encouraged Libyan terrorism for decades.

The outlines of the Libyan plot surfaced in a federal court case involving a Yemeni-born Muslim leader named Abdurahman Alamoudi. He pleaded guilty July 30 to violating U.S. sanctions against Libya and other crimes in what prosecutors said was "a conspiracy to murder a person outside the United States."

As part of his plea bargain, Alamoudi provided a "statement of facts" that detailed how he had traveled to Libya in the spring of 2003 and met a "high-ranking Libyan government official," described in the document only as "LGO No. 5" but identified by sources familiar with the case as Gaddafi. The Libyan leader directed Alamoudi to tell a Saudi dissident in London "to arrange the assassination of Crown Prince Abdullah" in retaliation for a public insult to Gaddafi a few weeks earlier. Alamoudi reported back to Gaddafi in late September 2003 "that he had delivered the message to kill Crown Prince Abdullah."

Support for Alamoudi's account has come from two Libyan intelligence operatives, Mohammed Ishmael and Col. Abdel-Fattah al Ghoug, who are being held in Saudi Arabia, according to an official familiar with their interrogation by the Saudis and by the FBI. About 15 alleged conspirators have been arrested by the Saudis, including six Libyans and about nine Saudi jihadists, the official told me; their plan was to kill Crown Prince Abdullah at a public event or during a motorcade.

The Libyan operatives financed the plot by delivering 4.5 million Saudi riyals (about $1.2 million) to a room at the Hilton hotel in Mecca in late November 2003. The Libyans had already wired $1 million for the conspirators to an account in the kingdom that Saudi officials were monitoring because they suspected it was used by the al Qaeda terrorist network.

The Bush administration has privately admonished Gaddafi for the terrorist plot -- even as it publicly lauds him as a poster boy for its anti-terrorism campaign. The contradiction isn't lost on members of a Libyan opposition group who complained in a June 16 letter to the State Department that the plot to kill the Saudi leader "occurred while Gadhafi was proclaiming to have abandoned his life of crime and terrorism and to have become a man of peace."

By touting Gaddafi's supposed conversion, the Bush administration has given him powerful political ammunition. "This is a new lease on life for the regime," says Ashur Shamis, a Libyan opposition journalist based in London who broke the assassination story in January. "Gaddafi interprets it as a climb-down by the U.S. and Britain in his favor," he says. "He is no longer under any pressure to make political changes at home."

Bush has packaged his reelection campaign around the claim that he is resolute and uncompromising in his struggle against terrorism. But the Saudis must wonder how serious the administration is when it lionizes a man who plotted to kill their ruler.