The deposed dictator is shown just feet from Ahmad Chalabi, a member of Iraq's American-picked Governing Council and once a Pentagon favorite to succeed Saddam.
The picture, covering most of the front page of the Al-Moutamar newspaper, which Chalabi publishes, was taken Sunday when Chalabi and three other council members were taken to see the former dictator.
In the photo, Saddam is sitting on a floor leaning against a bare tile wall, wearing a white robe and a jacket, while Chalabi sits next to him on a chair, leaning forward as if talking to him.
The edition disappeared off the newsstands by midday Thursday, with some vendors selling copies for more than double the price.
Chalabi's spokesman, Entifadh Qanbar, said even he couldn't find a copy of the paper. Iraqi papers have run the U.S. military's photos of Saddam in custody — but Iraqis are eager for any look at the man who ruled over them for decades.
Kadhim Abdel Razek, 57, said he couldn't find a single copy of the paper at many stands because it was sold out.
"I would pay double price, even more, to see the man closely," he said. "I just want to see what he is wearing, what shape he is in to compare it to the picture in my mind."
The Central Intelligence Agency is taking the lead role in the interrogation of the deposed Iraqi strongman, which U.S. officials have confirmed is occurring at an undisclosed location in Iraq. An interim council member said the former president is in the greater Baghdad area.
CBS News Correspondent Jim Stewart reports Hussein is being treated well, but subjected to sleep deprivation.
According to USA Today, Saddam is being shown videotapes of Iraqis demonstrating against him, mass graves, torture sessions and executions in order to trick him into revealing information. Interrogators are also closely watching his reactions as a guide to his responses to questions.
Intelligence and weapons experts doubt that the interrogation of Saddam will yield much useful information about guerrilla fighters or Iraq's alleged illegal arsenal. For one thing, he has little incentive to cooperate since his execution is likely. For another, he may know little about the insurgency killing U.S. troops or about the details of Iraq's illegal weapons programs — if any existed.
So far, Saddam has denied to his interrogators that his regime had weapons of mass destruction and ties to al Qaeda, U.S. officials said. He has also denied knowledge of the fate of Scott Speicher, the Navy fighter pilot who disappeared over Iraq during the first Gulf War.
U.S. intelligence and military officials say their first priority is to focus on the resistance and the whereabouts of Izzat Ibrahim al-Douri and other remaining senior regime officials and insurgent leaders.
The Washington Post reports a document found with Saddam when he was arrested has clues to the workings of up to 14 insurgent cells, and has led to the arrest of three generals.
The Post reports the document seems to indicate Saddam was an inspiration to the insurgency, rather than an operational commander.
An exile from Iraq from 1956 until this year, Chalabi headed the Iraqi National Congress and was a favorite anti-Saddam figure among many in Washington. His organization may have funneled much of the prewar intelligence on Iraq to U.S. agencies. During the war, Chalabi and a personal army were airlifted into Iraq.
But he has fallen from favor somewhat as he criticized the U.S. occupation.
Even before the war, he had his detractors: State Department analysts worried his long absence from Iraq would undermine his credibility, and audits raised questions about the INC's handling of U.S. funds.
In Jordan, Chalabi has been sentenced to 22 years in jail on embezzlement and other charges. — accusations he denies.