Several police were wounded in the operation in the Hashemi neighborhood of east Amman, which followed a tip-off from residents that "terrorists" were in the area, government spokeswoman Asma Khodr told reporters.

"A security force went to the site and asked them to surrender but they didn't and they opened fire on the Jordanian forces, wounding a number of them," she said.

"Three suspects were killed when police returned fire and a fourth, who was still holed up inside the building, was also shot dead" when he later engaged the police.

Only one of the suspects killed was a Jordanian while the others were foreigners, Khodr told reporters after the weekly meeting of the Jordanian cabinet.

She said the suspects were "affiliated to a terrorist group", adding that an investigation was under way to determine their identities and motives.

More than two hours after the shootout, anti-riot police, intelligence officers and civil defence units were still in evidence around the working class neighborhood.

Police fired tear gas into the two-storey building to flush out any remaining suspects.

An

AFP correspondent saw a fifth suspect being led away by police in handcuffs following the firefight.

The man spoke with an Iraqi accent and protested his innocence, according to a Jordanian journalist who was briefly detained along with him.

It was the latest in a flurry of counterterrorism operations undertaken by the Jordanian security forces in recent weeks which the US secretary of state hailed as "indicative of the "support that Jordan has provided to the United States in the war on terror".

"There was another good action on the part of Jordanian authorities this morning to intercept and bring to summary justice some of those who are trying to upset peace within the kingdom," Powell noted after Washington talks with Jordanian Foreign Minister Marwan Moasher later Tuesday.

Last week, Jordan's King Abdullah II said the security services had dismantled a "terror network", thwarting plans by the group to commit "a crime never before seen in the kingdom" which would have killed thousands.

The king, in a letter to the head of Jordan's intelligence services, General Saad Khair, which was made public on April 13, said all the members of the group had been arrested.

He later told a US newspaper, the San Francisco Chronicle, that Jordanian police had seized five trucks loaded with 17.5 tonnes of high explosives.

"It was a major, major operation," King Abdullah said in the April 17 interview.

"It would have decapitated the government," he said, adding that the explosives were apparently intended for attacks on the prime minister's office and the intelligence ministry.

An official involved in the inquiry later told

AFP that the network was linked to Abu Moussab al-Zarqawi, a fugitive Islamist sentenced to death here earlier this month for the October 2002 killing of a US diplomat.

He said the dismantled cell planned to use a chemical bomb against the intelligence headquarters in west Amman.

"We found primary materials to make a chemical bomb which, if it had exploded, would have made nearly 20,000 deaths ... in an area of one square kilometre," he said Saturday.

Zarqawi is now believed to be in hiding in Iraq where US officials say he is in charge of Al-Qaeda operations.