The government said it would not attempt to block the march if it was peaceful although Prime Minister Nuri al-Maliki, who ordered a crackdown on militia in the southern city of Basra last week, threatened more strikes against Sadr's strongholds.
A statement released by Sadr's office in the holy city of Najaf called on Iraqis of all sects to descend on the southern city, site of annual Shi'ite pilgrimages that attract hundreds of thousands of worshippers.
"The time has come to express your rejections and raise your voices loud against the unjust occupier and enemy of nations and humanity, and against the horrible massacres committed by the occupier against our honorable people," it said.
"If his intention is to get a whole lot of people together and go and make trouble in Najaf, I don't think that is going to be very popular," U.S. ambassador Ryan Crocker told a briefing.
U.S. forces called in helicopter strikes during a clash with suspected Sadr gunmen on Thursday in the city of Hilla and bombed a house in Basra overnight, after days of relative calm that followed a truce Sadr announced on Sunday.
The truce ended six days of fighting that spread through southern Iraq and Baghdad.
Officially, the Iraqi government is sanguine about the march. Interior Ministry spokesman Major-General Abdul-Karim Khalaf told Reuters: "The right to hold a peaceful demonstration and express opinions is guaranteed by the constitution, and we don't mind as long as the demonstration is peaceful."
But Maliki has been uncompromising toward the Sadrists, fellow Shi'ites who helped install him in power in 2006 but broke with the government last year.
The prime minister told reporters the Basra crackdown could be repeated elsewhere, listing the Shula and Sadr City districts, Sadr strongholds in the capital.
"Basra was a prisoner and now it has been freed," Maliki said. "Other cities need the same battle, and also Baghdad in areas where people are still in the hands of these gangsters."
A senior member of Sadr's bloc in parliament said the prime minister "must stop playing with fire, or the Sadr bloc and the Mehdi Army are ready for this battle, a crucial battle."
"The prime minister is trying to escalate the situation, and the brothers from the Sadr bloc are calling for calm," Sadrist lawmaker Bahaa al-Araji told a news conference.
MOBILISATION
Sadr has millions of followers and was able to summon tens of thousands of people on to the streets in Baghdad for demonstrations during last week's fighting. A march to Najaf would potentially mobilize swathes of Shi'ite Iraq.
Police sources in the Shi'ite city of Hilla said five people were killed in Thursday's predawn clash and helicopter strike, including four policemen. U.S. forces said the clash erupted when gunmen fired on them as they attempted an arrest.
A U.S. military spokesman said an air strike in Basra killed "one enemy" late on Wednesday.
Reuters television pictures showed a woman's body in the rubble and rescue workers searching for more dead. Police sources said at least three people had died including a mother, father and son, and three were seriously wounded.
Last week's violence exposed a deep rift within Iraq's majority Shi'ite community and served as a reminder of the instability after months of security improvements.
Hundreds died, making March the deadliest month for Iraqi civilians since last August, according to government figures.
Nevertheless, the chairman of the U.S. joint chiefs of staff, Admiral Mike Mullen, said Washington would not alter plans to withdraw about 20,000 troops by the end of July.
Crocker and General David Petraeus, the top U.S. civilian and military officials in Iraq, are due to report to Congress next week and are expected to recommend a pause in withdrawals after July to safeguard the past year's improvements.
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