US forces say they are taking up positions just outside Baghdad and are ready to fight in what could be a first crucial battle for control of the city.
Officials said an empty Baghdad airport showed the US was lying
The BBC's Paul Wood in Baghdad says a power cut has plunged most of the city into darkness and a heavy artillery barrage has erupted on the southern outskirts, apparently from the Iraqi side.
Earlier, troops of the US 3rd Infantry said they had pushed close to Saddam International Airport, about 20 kilometres (12 miles) from the city centre, while other US units said they were just 10 kilometres from the capital.
Iraq's information minister dismissed the claims as "silly," saying US troops were "nowhere near Baghdad".
Mohammed Saeed al-Sahaf said: "We're waging a war of attrition against this snake and we will be victorious."
Reports say the US units near the airport later pulled back.
Iraqi officials showed journalists a deserted Saddam International Airport to counter the US claims of progress.
In a separate development, US Brigadier-General Vincent Brooks said special forces had raided the Tharthar Palace north of Baghdad, used by Saddam Hussein and his family.
He said it had been hoped that leaders of the regime would be found in the complex, located near Saddam Hussein's home town of Tikrit, where there have been no previous reports of coalition military activity.
"On this occasion, we did not find them. But we did find a considerable amount of information," General Brooks said, without giving any details.
BBC correspondents travelling with US forces making advances from the south-west and south-east of Baghdad report different pictures.
David Willis, with a US marine unit, says they came under heavy fire near Aziziyah about 60km south-east of Baghdad, delaying a planned push across the River Tigris.
But Gavin Hewitt with the US Army's 3rd Infantry Division says the troops faced little resistance and there were few signs of the burnt-out tanks or the bodies expected if an entire division had been destroyed.
Republican Guard questions
Coalition commanders say two of the six divisions of the elite Iraqi Republican Guard have been beaten, a claim Iraqi officials reject. Each division would have about 8,000 men and scores of tanks.
Our correspondent says US forces faced only 200 or 300 Iraqi soldiers around Karbala and no more than 2,000 at Musayyib.
He says it does raise questions as to what has happened to the Republican Guard divisions that were guarding the southern approaches to the capital.
US military officials say parts of the four Republican Guard divisions they claim are still functioning have been moving south to meet advancing forces.
This could set up a possible showdown for Baghdad, but coalition commanders are keen to avoid being drawn into a fight on the city streets, where Iraqis would have the advantage of local knowledge and the risk of civilian casualties would be high.
Colonel Frank Thorp, at the US Central Command in Qatar, said: "Coalition forces at this point are outside of the Baghdad airport and are positioning themselves to engage that fight at a time of our choice".
The BBC's Andrew Gilligan in Baghdad, whose activities and reports are monitored by Iraqi authorities, has visited the airport and says there is no sign of increased military activity or any US forces.
In other developments:
- US President Bush rallies US marines at a base in North Carolina, saying "a vice is closing" on Saddam Hussein's regime
- US Secretary of State Colin Powell says the United Nations will "definitely" have a role in post-war Iraq, though its exact nature remains to be seen
- The BBC's John Simpson in northern Iraq says Kurdish troops backed by US air support have made big advances towards the city of Mosul, but are under heavy fire from the Iraqis
- US officials are investigating two separate incidents of possible "friendly fire": a Patriot missile may have downed an FA-18 Hornet plane, while ground forces may have been involved in an incident with an F-15 Strike Eagle which left a US solder dead; they say the loss of a Black Hawk helicopter over Iraq was not caused by enemy fire
- UK officials say British troops are fighting regular soldiers and militia as they try to secure the southern city of Basra
Inside Baghdad, correspondents say the atmosphere is almost surreal - there is no sign of forces being moved to defend the city and some level of daily life continues despite the continued air attacks.
Raids by B-52 bombers on units defending Baghdad included the use of highly controversial cluster bombs. They contain bomblets, some of which in the past have not exploded on impact but have injured civilians later.
The Iraqi information minister said: "This morning, these criminals dropped cluster bombs on the Douri residential area of Baghdad and 14 people - men, women and children - were martyred and 66 were wounded."
Britain also said it had used cluster bombs, but only in open areas.