Defiant Iraqi soldiers entrenched themselves in heavily populated residential areas of Basra today and used artillery and Soviet-era T-55 tanks to hold off U.S. and British troops who have besieged the strategic southern Iraqi city for two days.

The Iraqi tactic, moving fighters and heavy weapons into residential areas, had been predicted for the defense of the capital, Baghdad. But it was largely unexpected for Iraq's second-largest city, a trading hub of more than 1 million inhabitants on the Shatt al Arab waterway that leads into the Persian Gulf. U.S. and British troops had expressed hope that this would be a quick prize in the opening salvos of the ground war, perhaps through a negotiated surrender, and a showcase for what U.S. officials call the liberation of Iraq.

The continuing standoff challenged predictions going into the war by some officials and analysts in Washington -- that the Iraqi army in the south would surrender in droves, that few would be willing to fight for President Saddam Hussein and that U.S. and British soldiers would be hailed by Iraqi civilians freed from the brutality of Hussein's Baath Party government.

British tank crews interviewed here returning from the front-line entrances to Basra described running tank and artillery battles against a well-organized opposition army dug into the city and putting up tough resistance. The troops also said the Iraqi military's move into populated areas -- making bombing and shelling difficult without causing civilian casualties -- slowed the British forces' advance across a major bridge from Basra International Airport, which they already control, to the city center.

Soldiers in a British battle group composed of members of the Royal Fusiliers and the Queen's Royal Lancers, stationed on the highway to Basra near the airport, said they received orders not to fire on civilian areas without a clear view of the target. Crews manning 70-ton British Challenger 2 tanks, who pulled back for food, fuel and ammunition, described a determined if dwindling number of Iraqi soldiers putting up a tough stand in the city.

"The first ones who came in said they were getting skirmishes all morning," said Chris Atkinson, a Fusilier from Liverpool. "They're doing a bit of fighting. It's called Beirut fighting."

"It's their country, isn't it?" said Staff Sgt. Ian Trigg. Referring to the 1991 Persian Gulf War, he added: "It's different than when we kicked them out of Kuwait."

"They're moving all their artillery pieces into civilian areas, and we can't take any shots at civilian targets," said Lance Cpl. Dave Williams.

Cpl. Jim Bowen added, "Our commanders have been told from high up the chain that they can't fire mortars into civilian areas unless you have a clear shot." He said the concern was to minimize civilian casualties because "we're not here to kill the Iraqi people."

This British battle group arrived at the front lines of Basra early today and fought skirmishes throughout the day. The thud of artillery and the rapid crack of automatic-weapons fire could be heard from the center of the city, still obscured by plumes of thick black smoke from burning oil installations.

The British tank crews battling for Basra sought to move against the Iraqi tanks and artillery dug into residential areas, but permission was denied. "They asked for authorization to take on the targets," Bowen said. "And they were told they could not take on the targets unless they had a clear line of sight."

"It's not the blitzkrieg everybody thought it would be," Atkinson said. "I think it's for public opinion and not wanting to kill any civilians."

A soldier atop one of the Challengers, pausing briefly as it was fueled, said, "There's still resistance. It's organized." Asked how long it might be before Basra was taken, he replied: "Not tonight. Watch this space."

The Iraqis holding out in Basra are members of the regular Iraqi army's 51st Mechanized Division, not the elite Republican Guard divisions that have been moved to defend the Baghdad region and are expected to put up the stiffest resistance.

To the east, along the highway to Basra, British Fusiliers set up a checkpoint to keep anxious Iraqis from returning to a city still under heavy fighting. Iraqis approached the checkpoint all morning, in battered cars, red-and-white taxis and white pickup trucks with blue plastic crates of tomatoes piled high in the back. Some waved white clothes out the windows while others had white flags tied to their car antennas.

Some Iraqis shouted at the troops, demanding to be let past, only to be turned back at gunpoint.

"I want to go to Basra!" shouted one young Iraqi man in a crowd of about 20 standing about 100 yards back from the checkpoint. "Basra!" others in the crowd shouted.

"My family is in Basra!" shouted one young man wearing jeans and an untucked, checkered shirt. One of the soldiers at the checkpoint shouted back, "There's fighting up there, and you're not going up!"

A soldier brandishing a belt-fed 7.62mm General Purpose Machine Gun, with a British SA80 assault rifle slung across his back, pushed the crowd back.

Less than two miles from the checkpoint, along a tree-lined side road leading west to the village of Zubair, Iraqi men in civilian clothes stood on the street brandishing several AK-47 assault rifles and a rocket-propelled grenade launcher. The men had their weapons in the ready position as two carloads of journalists approached and other, apparently unarmed, Iraqis ran quickly away. The journalists made a hasty retreat to the main highway.

Further signs of instability emerged south of Basra, where U.S. troops have swept through on the way north, leaving mainly British military police guarding the highways.

At the same position where the British troops were resupplying the tanks, a commander walked down the supply line telling the soldiers to be alert because he had received reports that Iraqis armed with rocket-propelled grenade launchers were in the area and taking aim at vehicles sporting the sideways "V" sign used to mark U.S. and British military vehicles.

At a junction in the town of Safwan, on the border with Kuwait, British troops ordered 35 cars filled with journalists to leave the area for fear of an attack. About 15 miles up the road, where another British military police unit was temporarily based, a strict light blackout was ordered and the camp was ordered silent because of warnings of Iraqi military activity. A military truck convoy driving toward Safwan was stopped and each truck was instructed to switch off its lights and engines.

"Get yourself comfortable," a British soldier whispered to a reporter. "We're going to be here all night."

A U.S. soldier patrols a road on the outskirts of the southern Iraqi city of Basra, where Iraqi troops moved into residential areas and used artillery and Soviet-era T-55 tanks to hold off U.S. and British forces. An Iraqi man carries a child reportedly injured near the southern city of Basra, where Iraqi troops moved into residential areas and used artillery and Soviet-era T-55 tanks in an attempt to hold off U.S. and British forces.