General Sir Mike Jackson was speaking after a deadline for KLA demilitarisation was extended to midnight on Tuesday.

The original deadline on Sunday passed without KLA leaders signing up to an agreement that would transform the ethnic Albanian force into a civilian Kosovo Corps.

General Jackson said: "I hope that the leadership of the KLA will see that the failure to accept the weapons regime is in danger of unsettling the KLA membership and perhaps Kosovo's future as a whole."

The KLA wants to become a national army for an independent Kosovo but Nato insists it should be a lightly armed civil defence organisation.

KLA spokesman Hashim Thaci said: "The process of demilitarisation is still ongoing."

Nato's supreme commander, General Wesley Clark, arrived in Pristina on Monday for talks aimed at breaking the weapons deadlock.

He has held meetings with KLA chief of staff General Agim Ceku and several civilian KLA officials.

Obstacles

The BBC's Jon Leyne in Pristina: "There's potential for a dangerous situation to develop"

A diplomatic source said major obstacles stand in the way of an agreement and that the KLA is even objecting to the name of the new force.

Under a phased 90-day disarmament process signed in June, KLA troops agreed to remove their uniforms, hand in the last of their weapons and, for the majority, return to civilian life.

KLA leader Hashim Thaci has pledged the demilitarisation of his organisation

In a joint statement with UN mission chief Bernard Kouchner, Gen Jackson said the disarmament of the KLA was complete with more than 10,000 weapons turned in to peacekeepers.

It is unclear, however, whether this constituted the total number held by the rebels.

Many of the weapons reporters have seen at collection centres are in poor condition or are virtual antiques.

Kosovo Corps

The main stumbling block has been the structure and role of the new force - the Kosovo Corps.

The BBC's Orla Guerin reports: "The men who fought the Serbs are not quite ready to leave the stage"

Nato insists that the 5,000-strong corps should be a lightly-armed civil defence body restricted to humanitarian work and disaster relief.

The KLA, however, wants it to be the nucleus for a new national army of an independent Kosovo, and is demanding the right for more members to be allowed to bear arms.