U.S. forces barreled into the heart of Baghdad with a dramatic show of force Monday and met pockets of fierce resistance. British officials said troops found a body in southern Iraq that they believed was the notorious Iraqi general known as ''Chemical Ali.''

Missiles screamed over the Iraqi capital just after dawn and thunderous explosions shook buildings as the 2nd Brigade of the Army's 3rd Infantry Division moved north into the city and seized a presidential palace. In southern Baghdad, Iraqi rockets struck a group of Army personnel carriers at the brigade's field headquarters, according to a military report. At least six soldiers were missing and a large number were wounded.

To the south, British troops gained control over much of Basra, Iraq's second-largest city, and were pressing into the old city where the last paramilitary fighters had retreated. Some Basra residents cheered the British, while others went on a looting rampage, streaming out of the Central Bank of Iraq and the bomb-damaged Sheraton Hotel with armloads of chairs, tables, carpets and other goods.

Troops in Baghdad stormed Saddam's New Presidential Palace and set up a prisoner of war holding pen inside the elaborate compound on the west bank of the Tigris, a winding river that divides the city. The ruling Baath Party headquarters nearby was completely destroyed. Up the river at the Old Palace, the sound of explosions and heavy fire could be heard. In the center of the city, U.S. forces used explosives to destroy two statues of Saddam.

The drive was meant to send a strong signal about the coalition's ability to enter Baghdad, said Navy Capt. Frank Thorp at U.S. Central Command. But it wasn't clear the troops were there to stay.

''We're comfortable with a very deliberate strategy to move through the city and come back out,'' Thorp said. ''I wouldn't comment on what we're going to do tomorrow or the next day. But what this does is it continues to destroy elements of the Iraqi military.''

Iraqi Information Minister Mohammed Saeed al-Sahhaf, standing on a Baghdad rooftop, denied his city had been invaded. Sirens could be heard as he spoke and clouds of dust blew past - remnants of a sandstorm and smoke from oil fires set by the Iraqis to obscure targets.

''They are sick in their minds. They say they brought 65 tanks into center of city. I say to you this talk is not true,'' al-Sahhaf said. ''There is no presence of American infidels in the city of Baghdad, at all.''

Armed militiamen and Iraqi army troops patrolled the street outside the Information Ministry. Most Iraqis stayed indoors, but some shops were open and public buses were running. Iraqi TV and state radio stayed on the air, broadcasting patriotic songs, religious sermons and archival footage of Saddam.

On the southern outskirts of Baghdad, two Marines were killed and two others were injured when their vehicle was struck by an artillery shell at a bridge over a canal. The 3rd Battalion, 4th Marines fought for the highway bridge that leads into the city Sunday, and were trying to cross it when they were hit Monday morning, Lt. Col. B.P. McCoy said.

The Marines quickly worked to repair the bridge while others crossed on foot to secure the other side of the canal, wary of booby traps that may have been set by Saddam's Fedayeen militia.

Troops everywhere have been warned of possible suicide attacks, including by bombers in ambulances. There were also reports from the field that Iraqis in civilian vehicles, possibly carrying bombs, had attempted to ram coalition tanks.

In the southern port city of Basra, British forces consider their biggest threat to be militia fighters still roaming the city. But with the suspected death of Iraqi Gen. Ali Hassan al-Majid, Iraqi fighters and Baath Party militants may be rudderless.

British Defense Secretary Geoff Hoon said he had not yet confirmed that al-Majid had been killed, though the evidence was strong. Al-Majid, a cousin of Saddam, gained the nickname ''Chemical Ali'' for ordering a poison gas attack that killed thousands of Kurds in 1988. His home was targeted in coalition airstrikes over the weekend.

His death should show the people of southern Iraq ''that the regime is finished,'' said Group Capt. Al Lockwood, spokesman for British forces in the Gulf.

The convoy that pressed into Basra's old city Monday consisted of jeeps mounted with heavy guns, which are lighter and better suited to urban combat.

Also to the south, U.S. forces took control of the center of the holy city of Karbala, the Army Times newspaper reported Sunday.

At Baghdad's airport, members of the 101st Airborne Division fought Iraqis in military uniform in a prolonged overnight battle, killing at least 100 fighters.