Iraqi forces supported by US troops laid siege to the city of Baquba and arrested 35 suspects on Wednesday, the second day of a major assault on al Qaida fighters in dangerous Diyala province.

The operation involves about 50,000 Iraqi police and soldiers, with US troops offering intelligence and logistical support, General Ali Gedan, director of military operations in Diyala, told AFP.

He said a tight security cordon had been thrown around the provincial capital Baquba, 60 km north of Baghdad, with scores of police checkpoints set up to prevent non-residents from entering or leaving.

Military operations, which began on Tuesday and which involve neighbourhood-by-neighbourhood searches across Diyala for militiamen and illegal weapons, had netted dozens of suspected militants, another official said.

"Up to midday our forces detained 35 wanted for terrorism and others involved in crime, murder and setting of explosions," defence ministry spokesman Mohammed al-Askari told AFP.

"Iraqi security forces are controlling the entry routes into Diyala to stop terrorists from escaping to other provinces," Askari added.

The offensive follows similar Iraqi military operations in the southern provinces of Basra and Maysan, and the northern province of Nineveh, as Iraq forces try to shore-up recent security gains in the war-torn country.

Fed by the Euphrates and Diyala rivers, Diyala was once the granary of Iraq and its lush orchard made it the country's orange capital, but its multi-ethnic population has proven one of the most dangerous to control.

In an interview with AFP last week, Colonel Ali al-Karkhi, commanding officer of Iraqi forces in Khan Beni Saad, said Diyala was "the most dangerous province in Iraq."

The province, which has a long border with Iran has been a centre of weapon smuggling, has suffered repeated suicide bombings, thought to be mostly orchestrated by Sunni al Qaida operatives.

Aided by the US military and Iraqi forces, local anti-Qaida groups known as "Sahwa" or Awakening councils, have turned the tables on rebels but they continue to wage attacks in the region.

On July 15 two suicide bombers blew themselves up at an at a Iraqi army recruitment centre in the base where young men had arrived to join the army, killing at least 20 people and wounding 55.

Other suicide bombings have been carried out by females, with one woman killing eight people when she blew herself up as an Awakening patrol passed by in Baquba last week.

Awakening groups began in the western province of Anbar when Sunni tribal leaders turned on their former al Qaida allies in 2006, and since then similar bodies have sprung up across Iraq, supported and paid for by the US military.

Although the latest military operations have forced business to a halt in Baquba, with stores and restaurants closing, residents expressed relief that actions were under way to end the chronic violence.

"I have no work now, but I'm relieved because my children will be safe from terrorists, who are killing people and extorting money," said Ibraheem Abdallah, a 32-year-old taxi driver.

Meanwhile, in the eastern part of the province that borders Iran, Iraqi forces that had moved into the area as early as last Friday had unearthed weapons caches of mortar rounds, rocket propelled grenade launchers, and AK-47 rifles, the US military said.

"The operation started south of Balad Ruz to deny the area as a safe haven to criminals in the Diyala and Baghdad provinces and to pursue them wherever they may go," US Army Lieutenant Colonel Paul Calvert said on Wednesday.

"Operations will continue to press forward until the objective has been accomplished," he added.