Fallujah's days as a breeding ground for terrorists may be about to end - and not a moment too soon.

Iraq Prime Minister Ayad Allawi has warned Fallujah's leaders he would order an attack if they do not turn over foreign terrorists led by Abu Musab al-Zarqawi, a Jordanian militant tied to Osama bin Laden's al Qaeda terrorist group.

This hardening of policy on Fallujah is long overdue. Home to roughly 300,000 predominantly Sunni Arabs, the city has become a sanctuary for a motley collection of foreign terrorists, homegrown Islamic militants, diehard Ba'athists and tribally based insurgent groups. 

An earlier offensive spearheaded by U.S. Marines was called off last April when members of the former Iraqi Governing Council objected to the prospect of a prolonged American siege.

Instead, the Governing Council proposed a stillborn agreement with Fallujah's leaders that included establishing a local militia ostensibly to restore the rule of law. The militia, led by former members of Saddam Hussein's Ba'ath Party, soon melted away after the threat of an American offensive was removed. Many members defected to antigovernment insurgents. Fallujah became a strategic base and staging area for terrorist attacks in Baghdad and surrounding areas.

The insurgents, emboldened by their success in Fallujah, have escalated a campaign of intimidation, kidnappings and assassinations to undermine and demoralize the embryonic Iraqi government. In recent months, they beheaded several government officials and released videotapes of these acts. The governor of Anbar Province was humiliated and forced to resign after three of his sons were kidnapped and threatened with death. Other government officials succumbed to intimidation and defected to the rebels, including the Ramadi police chief, who had survived three assassination attempts.

A Talibanlike regime has seized control of Fallujah and imposed a harsh brand of sharia (Islamic law) on the people there. A radical Iraqi Sunni cleric, Abdallah al-Janabi, has declared himself to be the "emir" (prince or leader) of the "Islamic Republic of Fallujah." Much like Mullah Omar, who declared himself emir of Afghanistan, Janabi works closely with foreign terrorists. He has allied with Abu Musab al-Zarqawi, the leader of the terrorist group Al-Tawhid Wal-Jihad (Unity and Holy War), which has close links to al Qaeda.

Al-Zarqawi's Tawhid group has carried out dozens of terrorist bombings in Iraq and assassinated scores of government officials. Tawhid also is responsible for many American deaths.

Zarqawi has recruited an unknown number (perhaps several hundred) of foreign Arabs to fight in Iraq and remains one of the most dangerous terrorist groups in the world. If allowed to operate freely from Fallujah, al-Zarqawi's group will pose a mounting threat not only to Iraqis, Americans, coalition forces and foreign civilians inside Iraq, but also to targets outside Iraq.

Fallujah has become a symbol of resistance to transforming Iraq into a stable democracy. As long as it remains a sanctuary for foreign terrorists and Iraqi insurgents, it will be impossible to secure and stabilize the rest of Iraq.
    
After backing away from a full-fledged assault last April, the United States has maintained pressure on insurgents in Fallujah through air strikes on their bases and safe houses. This apparently has led to growing friction between foreign militants and local residents angry at the risks they are forced to bear due to the provocations of the foreign Arabs.
    
Prime Minister Allawi realizes this - hence his ultimatum. And after the successful Oct. 1 offensive in Samarra by U.S. and government forces, Mr. Allawi has more leverage to apply. Government forces must stay on the offensive to tilt the psychological field against the insurgents, keep them off balance, and disrupt their plans for future attacks.
    
We're also at the beginning of Ramadan, a holy month in the Islamic calendar in which Islamic extremists have in the past often chosen to launch attacks. There is a good chance Iraqi insurgents may seek to launch a Tet-like offensive to undermine the Iraqi government and coalition forces inside Iraq.
    
The United States should strongly back Mr. Allawi's efforts to rout the insurgency in Fallujah. This time the Marines, backed by the Iraqi army and National Guard, should complete their mission and relentlessly root out the insurgents as rapidly as possible. We need to avoid another halfhearted encirclement and a pullback that leaves hostile forces in control. Otherwise, the Fallujah insurgency is likely to metastasize into a cancer that will kill any hope for a stable Iraq.

James Phillips is a research fellow in Middle Eastern affairs at The Heritage Foundation (heritage.org).