The symbolic handovers -- of political power and Saddam Hussein -- are over. Now the real challenges begin in Iraq. Baghdad's new interim government, the United States and the United Nations have only seven months to stabilize Iraq, accelerate reconstruction and hold the country's first democratic elections.

This next stage -- the second of Iraq's three-stage transition -- could prove to be even tougher than the 14-month occupation, U.S. and U.N. officials predict.

"We won't achieve it all. I don't think we can pacify the country in seven months," said a senior State Department official who insisted on anonymity. "On reconstruction, we'll certainly see change, but the scope is huge and the better timeline is really two years from now.

"Where you will see the most progress is in the electoral process . . . and achieving security remains the $64 million question. I can't say it will be fully addressed with any degree of confidence."

In the meantime, several wild cards could undermine early support for the interim government. Electricity shortages alone could unravel the process, U.S. and U.N. officials warned. Repairs during the winter only triggered new problems, as Iraqis bought refrigerators and air conditioners that overwhelmed the new output capability, according to Ross Mountain, acting U.N. special envoy to Iraq.

The calendar for the next phase of the transition centers on two political events. The first is a national conference of 1,000 tribal and provincial leaders, professionals, academics and other prominent Iraqis later this month. The second is, by the end of January, the first democratic election of a national assembly -- the real barometer of success.

"If we pull off, with the assistance of the international community and particularly the United Nations, an election in December or January of 2005, as we're trying to do, that will be one of the more monumental occurrences in the Middle East in several hundred years," Deputy Secretary of State Richard L. Armitage said in a radio interview with Hugh Hewitt last week.

That election will pave the way for the final phase of Iraq's transition, when the new assembly is due to choose a transitional government with real executive powers -- which the current interim government lacks -- and draft a constitution. That year-long phase will end with elections for a permanent government.

But the second phase contains political hurdles and physical dangers for all parties to get over first. The United Nations has not overseen an election in such a large country or such a hostile environment. The United States faces an escalating insurgency. And Iraq's new leadership is still struggling to get its bearings.

The challenge begins with convincing Iraqis that their new government is legitimate -- a big step in itself -- and then explaining democracy and getting them to register to vote, form political parties, select candidates, develop platforms and campaign, Iraqi and U.S. officials said. That all has to be accomplished in slightly more than 200 days.

The first task may be as much psychological as political. "The Iraqi government must do what the CPA [Coalition Provisional Authority] conspicuously did not, which was to win hearts and minds," said Rend Rahim Francke, Iraq's top envoy to Washington, at a recent American Enterprise Institute conference. "To do that, we must sell the new order to the entire Iraqi population, and we must sell it to segments of the Iraqi nation that hitherto may have not been totally persuaded."

The United States and the United Nations both want to take a back seat, letting the inexperienced Iraqis control the process so it gains domestic credibility, U.S., U.N. and Iraqi officials said.

A U.N. team is helping set up the structures for an election but it will not run the polling, as it did in Cambodia and East Timor. The team will mainly train and advise the seven-member election commission, which it selected. The Iraqi commissioners will set the rules, procedures, timeline and logistics, including distributing ballot boxes, U.N. officials said.

Washington will also largely defer political assistance to others, mainly by funding nongovernmental U.S. organizations to help with voter education and the creation of a civil society. The new U.S. Embassy will not engage in any aspect of Iraqi politics, State Department officials said.

U.S. officials and analysts differ widely on the prospects for this second phase. "Obviously, looking out over the next six to eight months, the key question is whether they get security enough under control that credible elections can be held in January on schedule," former U.S. administrator of Iraq L. Paul Bremer told a small group of reporters in Washington shortly after returning from Baghdad. "I believe they can."

But Iraq experts are concerned that public support for the new government could quickly dissipate.

"If the new government is unable to contain the insurgents and terrorists, and if it is unable to win the support of the diverse ethnic and sectarian communities in Iraq, then a weak and discredited central government will be no match for local warlordism and the growth of terrorist infrastructures," said Judith Yaphe, a former CIA expert now at the National Defense University. "If this happens, the outcome will not be the hoped-for democratic Iraq of 2005 and beyond, but a country more like Lebanon in the 1980s or Afghanistan in the 1990s -- only in this case a country replete with oil wealth and a great capacity to wreak havoc beyond its borders."

The tone of the second phase will be heavily influenced by the outcome of the national conference, progress in reconstruction and security.

The conference is designed to launch "a national dialogue of the new who's who in Iraq," said a U.N. official, and expand participation beyond the handful of largely exiles handpicked by the outside world. It will select about 100 Iraqis to serve on an interim national council, which will not legislate but will create the first check on government by being able to question its ministers on policy and actions.

"A national gathering that legitimizes the selection of the new leadership and captures the attention of the Iraqi people with a major Iraqi-run political event, tied directly to the phased, scheduled withdrawal of the coalition security forces into cantonments, would set the conditions for successful elections," wrote Keith W. Mines, a former CPA official, in an article for the Foreign Policy Research Institute.

Jump-starting the economy through reconstruction must be a parallel process, with the interim government trying to win Iraqi participation by feeding "their wallets and their bellies," Francke said.

The United States estimates that foreign aid could create a million jobs over the next two years -- with concern about whether the pace will be fast enough. Iraqis also want a new aid strategy, switching from large, high-tech infrastructure projects, which went largely to U.S. and foreign corporations, to more labor-intensive projects to generate more jobs for Iraqis.

But the biggest factor will be ending the violence, U.S., U.N. and Iraqi officials agree. "Unless you get security under control, everything else will be held hostage," the senior State Department official said.

A two-pronged strategy is evolving that centers, first, on Iraq's attempt to co-opt its own, largely Sunni Muslim, insurgents -- estimated at around 5,000 -- by bringing more former Baathists, Sunnis and critics into the system, Iraqi and U.S. officials say. "Some of them may not be perfect democrats, and some may be Baathists," Francke said. "But I would rather err on the side of inclusion than exclusion at this point."

While training Iraqis as eventual replacements, troops from the U.S.-led multinational force will focus largely on pursuing extremists loyal to Abu Musab Zarqawi, estimated to number about 200, and Arab foreign fighters, also in the low hundreds, U.S. officials said.

Despite a relatively hopeful first week for the new Iraqi government, analysts cautioned that expectations should be modest.

"It took Britain nearly 900 years and a civil war to evolve into a truly representative government. It has taken the U.S. more than 225 years and a civil war to achieve its current state of democracy," Yaphe said. "How can the Iraqis be expected to achieve this in one year?"

Correspondent Rajiv Chandrasekaran contributed to this article from Baghdad.