The trouble erupted when troops tried to clear members of the Revenge of God party, a Shia organisation, from a government building they were illegally occupying.

Television footage showed soldiers wearing helmets and visors using batons and riot shields to beat back the crowd of demonstrators.

One Iraqi grabbed a soldier's assault rifle and pulled it away from him before several other soldiers intervened.

The crowd threw rocks and iron bars at the armoured Land Rovers but after 30 minutes the protesters dispersed. An Iraqi news photographer was injured by a rubber bullet.

One of the injured Iraqis was seen lying on the ground before being carried away by his comrades. Another was shown with blood pouring from his head.

"There was a public order disturbance as British soldiers evicted illegal tenants from a local government building," said a spokesman from the Ministry of Defence. "Soldiers took appropriate measures to contain them and three soldiers suffered minor injuries."

Although security in the predominantly Shia areas of southern Iraq has been better than elsewhere, there has been a series of demonstrations in recent weeks, largely about unemployment. Last week, 13 British soldiers were injured in a protest during which several soldiers were briefly engulfed in flames.

In the months after last year's war, several hardline and well-armed Shia parties emerged in Basra. Supporters of the parties have conducted unauthorised armed patrols across the city and are believed to have been responsible for the killing of several former Ba'athists in the city.

Separately, the US military said yesterday that its troops had killed four Iraqi rebels in Mosul, in the north. Two soldiers were injured in the gunfight late on Sunday.

A statement said the troops had stopped the Iraqis' vehicle because it matched the description of one used in an earlier drive-by shooting at American forces in the city.

Inside the vehicle, soldiers found assault rifles, a rocket-propelled-grenade launcher and other weapons.

The shootings came after one of Iraq's ministers, Nasreen Barwani, escaped unhurt after her convoy was attacked in Mosul. Her driver and bodyguard were killed in the incident.