The Army's powerful 1st Armored Division is proclaiming victory over Sheik Muqtada al-Sadr's marauding militia that just a month ago seemed on the verge of conquering southern Iraq.

The Germany-based division defeated the militia with a mix of American firepower and money paid to informants. Officers today say "Operation Iron Saber" will go down in military history books as one of the most important battles in post-Saddam Hussein Iraq.

"I've got to think this was a watershed operation in terms of how to do things as part of a counterinsurgency," said Brig. Gen. Mark Hertling, a West Point graduate and one of two 1st Armored assistant division commanders, in an interview last week as he moved around southern Iraq. "We happened to design a campaign that did very well against this militia."

When the division got word April 8 that Sheik al-Sadr's uprising meant most 1st Armored soldiers would stay and fight, rather than going home as scheduled, it touched off a series of remarkable military maneuvers.

Soldiers, tanks and helicopters at a port in Kuwait reversed course, rushing back inside Iraq to battle the Shi'ite cleric's 10,000-strong army. Within days, a four-tank squadron was rumbling toward the eastern city of Kut. And within hours of arriving, Lt. Col. Mark Calvert and his squadron had cleared the town's government buildings of the sheik's so-called Mahdi's Army.

Meanwhile, Maj. Gen. Martin E. Dempsey, 1st Armored commander, huddled with Gen. Hertling and other senior aides to map an overall war strategy. The division would shift from urban combat in Baghdad's streets to precision strikes amid shrines of great religious significance.

Hunting the enemy in tight city streets broadened to patrolling a region the size of Vermont.

Gen. Dempsey first needed the locations of Sheik al-Sadr's rifle-toting henchmen. Average Iraqis, fed up with the militia's kidnappings and thievery, quickly became spies, as did a few moderate clerics who publicly stayed neutral.

Once he had targets, Gen. Dempsey could then map a battle plan for entering four key cities -- Karbala, Najaf, Kufa and Diwaniyah. This would be a counterinsurgency fought with 70-ton M-1 Abrams tanks and aerial gunships overhead. It would not be the lightning movements of clandestine commandos, but rather all the brute force the Army could muster, directed at narrowly defined targets.

Last week, Sheik al-Sadr surrendered. He called on what was left of his men to cease operations and said he may one day seek public office in a democratic Iraq.

Gen. Hertling said Mahdi's Army is defeated, according to the Army's doctrinal definition of defeat. A few stragglers might be able to fire a rocket-propelled grenade, he said, but noted: "Do they have the capability of launching any kind of offensive operation? Absolutely not."

The division estimates it killed at least several thousand militia members.

Gen. Dempsey designed "Iron Saber" based on four pillars: massive combat power; information operations to discredit Sheik al-Sadr; rebuilding the Iraqi security forces that fled; and beginning civil affairs operations as quickly as possible, including paying Iraqis to repair damaged public buildings.

"As soon as we finished military operations, we immediately began civil-military operations," said Gen. Hertling. "We crossed over from bullets to money."

The strike into Kut was followed by an incursion into Diwaniyah. Then an 18-tank battalion entered Karbala, a holy city where precision operations were needed to spare religious shrines. Then soldiers moved into Najaf and Kufa, where Sheik al-Sadr was hiding out and where about 3,000 of his fighters occupied government buildings, mosques, amusement parks and schools.

"We were going from outside in to get this guy," Gen. Hertling said. "We had to go after them one city at a time."