The Iraqi Governing Council has failed to reach agreement with the US-led coalition that controls the country over Turkey's decision to send troops to Iraq.
Turkish troops may not necessarily be welcomed by Arab Iraqis
Opposition to the Turkish deployment threatens to bring about the most serious public split so far between the governing council and the American authorities, correspondents say.
After a meeting of several hours with US administrator Paul Bremer, the council said the issue had not yet been resolved.
Kurdish representatives on the council have been particularly opposed to the presence of up to 20,000 Turkish troops, given the tension between Iraqi Kurds and Turkey.
The two sides are expected to meet again in Baghdad on Thursday, in the search for a compromise.
The issue is exposing disagreements not only between the council and the American-led administration, but also within the council itself.
Council member Songul Chapouk told the BBC that widely differing views had been expressed at talks on Wednesday, ranging from those who supported deployment to those who were strongly opposed to troops from any of Iraq's neighbours.
"Our Kurdish colleagues have rejected the deployment of Turkish troops on their territory because they fear it could create problems for them," she said.
But Ms Chapouk said that other members of the council wanted to continue discussing the issue, and focus on the details of the deployment.
Credibility 'at stake'
The BBC's Jill McGivering, in Baghdad, says there is strong pressure on both sides to work out a compromise.
Although it is in charge, the coalition wants to be seen as sympathetic to Iraqi views.
The council knows its credibility will be badly damaged if it expressed strong opposition to Turkish troops and they were deployed anyway.
TURKISH ARMED FORCES
Total strength nearly 700,000 - second largest army in Nato
Mainly conscripts, although conscript numbers being cut by 17% a year
Staged three coups, in 1960, 1971 and 1980
Repeatedly attacked Kurdish rebels in northern Iraq
Defeated PKK Kurdish rebels in Turkey in 1999 after 15-year war
Commanded Isaf peacekeepers in Afghanistan from June 2002 to February 2003
This is a highly emotive issue, our correspondent adds, but the fact both sides are planning to carry on talking is itself a positive sign.
IGC President Iyad Allawi told Associated Press: "We shall positively take into account the needs of our friends in the coalition who are keen on having the Turkish army here, but at the same time there are important sensitivities that must be considered."
The deployment of the troops was approved on Tuesday by Turkey's parliament.
The United States has been pressing for some time for Turkey to join the international force in Iraq and help on the ground.
It would be the first major deployment of troops from a Muslim nation since the war ended.
They would be deployed in the Sunni areas of central Iraq - where US troops face almost daily attack from hostile Iraqi elements - and not in the northern Kurdish areas.
But BBC Arab affairs analyst Magdi Abdelhadi says the American-led administration appears to have once again underestimated regional and cultural sensitivities in Iraq.
Although the vast majority of Iraqis are Muslims, he says, this does not necessarily mean they would welcome troops from neighbouring Muslim countries any more than those from far afield.
Our correspondent points out that Arab nationalism in Iraq emerged partly in response to what many there saw as the oppressive rule of the Ottoman Turks during the 19th century.