The arrests were announced on Monday by the Intelligence Ministry, and were praised by Iranian President Mohammed Khatami.

Middle East Correspondent Jim Muir: "Huge blow to the hardline faction"

Supporters of the reformist president are now calling for the resignation of Intelligence Minister Qoorban-Ali Dorri-Najafabadi.

US State Department spokesman James Rubin said: "The arrests are a positive step toward maintaining the rule of law in Iran and providing for the security of Iranians to express their beliefs."

BBC Middle East Correspondent Jim Muir says the shock admission is a huge blow to the hardline faction in its power struggle with the reformers.

A series of abductions and murders of liberal intellectuals and writers late last year was widely seen as an attempt by hardline conservatives to crush the reformist movement.

Conservatives had blamed foreign agents for the killings, saying only Iran's enemies - including the United States and Israel - would gain from a terror campaign to destabilise the country.

But a ministry statement on Tuesday said: "Unfortunately a few irresponsible, evil-minded and wilful colleagues of this ministry ... were among those arrested [over the killings]."

It said their actions amounted to treason against fellow Intelligence Ministry agents and had damaged the reputation of the Islamic regime.

Network broken

The ministry, which is in charge of internal security, is regarded as being in the hands of the hardliners.

A reformist newspaper, whose revelations triggered the Intelligence Ministry admission, is demanding that those higher up the chain of command at the ministry should also be punished.

President Khatami: Strengthened by the arrests

The ministry statement said a network that included secret service agents acting on their own had been broken.

It said the arrested agents "had no doubt become tools of secret hands and committed these criminal acts in the service of foreign interests".

It added that those responsible for the killings would be brought to justice but did not say how many people are being held.

At least three secularist authors and two opposition leaders died in November and December in mysterious circumstances. The killings sparked widespread fear among Iran's cultural elite.

They were seen as a setback to the movement for change which lifted reformist President Mohammad Khatami to office in 1997.

However, correspondents say the arrests are likely to bolster the position of President Khatami, who has advocated the rule of law as a major part of his liberal political and social reforms.