Diplomats, speaking on condition of anonymity, said the final product may be a softer text that doesn't explicitly call for war.
On another diplomatic front, Belgium offered a compromise Saturday to end a bitter dispute within the NATO alliance over providing military aid to Turkey in advance of a possible war against Iraq.
Prime Minister Guy Verhofstadt said Belgium, France and Germany would endorse a U.S. proposal for such help if NATO makes clear the aid is defensive in nature, and it must not be seen as making the alliance a participant in war preparations against Iraq.
NATO called an urgent session of the ambassadors of its 19 member states for Sunday to discuss the proposal.
The refusals by Belgium, France and Germany to endorse any military planning for Turkey - which has requested assistance from its fellow allies - plunged NATO into its deepest crisis since the Cold War ended.
Belgium, France and Germany all have said in the past month that sending military hardware to Turkey would undercut efforts to find a peaceful solution to the Iraq crisis.
The New York Times reports in its Sunday editions that Iraq's strategy to thwart a United States-led attack calls for slowing American troops' advance toward Baghdad and then confronting them with the prospect of a bloody street battle in the Iraqi capital. The Times cites American intelligence sources.
Before Friday's dramatic Security Council meeting, where weapons inspectors gave a relatively favorable accounting of Iraq's recent cooperation, Washington and London had been preparing a toughly worded resolution that would give them U.N. backing for military action.
British diplomats had said then that any resolution would have to include an authorization of force. They described working versions of the draft as short, simply worded texts that found Iraq in "material breach," of its obligations and reiterated that Saddam now faces "serious consequences," as a result.
In diplomatic terms, coupling the consequences with material breach would be tantamount to an authorization.
But the measured reports by inspectors, in addition to massive global opposition to war - expressed both in the council and in the streets - came as a blow to the plans of Washington and London.
The two allies had hoped to push through a new resolution quickly, and there had even been talk of a Saturday council meeting to introduce it. But those plans were put on hold Friday after staunch opposition, led by France, Russia and China drew rare applause inside the council chamber.
British and American diplomats conceded they would need to go home, consider the views of others and soften the tone of the draft.
"The situation is very fluid and so is the language right now," said Pakistani Ambassador Munir Akram.
While Secretary of State Colin Powell said after Friday's meeting that there was no talk of compromise yet, some diplomats said privately that it was the responsibility of the five council powers - the United States, Britain, France, Russia and China - to negotiate a way out of the impasse over Iraq.
Unless that happens, President Bush and British Prime Minister Tony Blair are unlikely to gain U.N. support for a war to disarm Iraq, and would have to decide whether to go to war without it.
CBS News correspondent Mark Knoller says that while the U.S. could clearly win any war with Iraq, allied support is "critical" for the long-term.
Sandy Berger, President Clinton's national security adviser, told Knoller, "The risks will be less, the prospects of success will be greater, and we'll have allied not only in the war, but, perhaps more importantly, in the peace, which is going to be costly, difficult and protracted."
U.N.-backing is particularly important for the British government, which faces strong public opposition to a war. More than 750,000 people attended an anti-war protest in London Saturday and millions more joined in similar demonstrations across the globe.
Diplomats say that by the middle of next week, Washington and London will have a better idea about how soon they can circulate a new draft.
All sides acknowledge they want to avoid forcing France, Russia or China to veto the resolution. So the draft will have to be considerably reworked or be designed to be withdrawn - a diplomatic strategy that would demonstrate Britain and the United States want U.N. support but not at any cost.
Blair said Saturday it would be "an act of humanity" to depose Saddam Hussein and insisted signs of Iraqi cooperation with weapons inspectors were suspect.
"Ridding the world of Saddam would be an act of humanity," Blair told a conference of his ruling Labor Party in Glasgow, Scotland as he laid out a "moral case" for military action against Iraq.
"It is leaving him there that is inhumane. That is why I do not shrink from military action should that indeed be necessary."
NATO members were reported in top-level negotiations Saturday seeking a compromise in a dispute over planning for a possible Iraq war that has produced the alliance's worst split in years.
For the past month, Germany, France and Belgium have blocked a U.S. proposal for NATO to send early warning planes, missile defenses and anti-biochemical warfare units as a precaution to Turkey, the only NATO country bordering Iraq.
The holdouts argued such a step could undercut efforts to find a peaceful solution to the Iraq crisis. The other 16 NATO allies said the delay undermined NATO's credibility as an alliance that defends its members and sent a signal of weakness to Saddam Hussein's regime.
A senior diplomatic source, speaking to The Associated Press on condition of anonymity, said a solution was likely Monday or Tuesday.
The State Department said the United States and Turkey held productive discussions over a proposed multibillion-dollar aid package that would be tied to support for a U.S.-led invasion of Iraq.
An emboldened Iraq staged huge demonstrations Saturday and boasted of having "men and supplies to fight for 10 years" as the United States and Britain sought to recover from their U.N. setback to their hard-line stance against Saddam Hussein.
On a worldwide day of anti-war protests, tens of thousands of people marched in cities across Iraq, many brandishing assault rifles and waving giant pictures of Saddam.
"On our land, thank God, we have enough resolve, determination and faith, and enough men and supplies, to fight for 10 years," the official Iraqi News Agency quoted Foreign Minister Naji Sabri as saying. "We are able to repel anyone who touches our borders. We will cut off their heads."
Sunday's New York Times reports that, to impede American and allied force in the event of an attack, Saddam's administration has developed plans to blow up dams, destroy bridges and ignite its oil fields. Pentagon officials told the Times Iraq may also deny food to Iraqi civilians in the southern parts of the country to try to create a crisis that would saddle advancing allied forces with the responsibility of caring for millions of desperate Iraqi civilians.
Once American and allied forces approach Baghdad, they will encounter two defensive rings of elite Republican Guard forces, according to the Defense Department officials who spoke with the newspaper. Many of the Republican Guard forces are now dispersed, a move that is intended to help them survive the airstrikes that would open the allied campaign. But as allied ground forces approach Baghdad, the Iraqis are expected to rush to fighting positions that have already been stocked with ammunition and supplies.
Some Republican Guard units are equipped with chemical protective gear, as are Special Republican Guard units and some intelligence and security forces inside Baghdad, according to intelligence reports. This is one of several signs that have led American officials to conclude that Iraq will try to use poison gas or germ weapons against the American and allied forces.
Meanwhile, arms inspectors continued their work Saturday, visiting a dozen sites across the country.
Iraqi leaders clearly felt vindicated by the inspectors' reports on Friday to the Security Council.
"They haven't found anything anywhere they've been, and they will not find anything, simply because there are no banned weapons in Iraq," Sabri said. "This is a fact that both the United States and Britain know very well, but these two nations have obvious colonial objectives."
His comments were made in Cairo, Egypt, where he was meeting with other foreign ministers of the Arab League nations to discuss convening an emergency summit on the Iraq crisis.
In Baghdad, Saddam spent 90 minutes with Roman Catholic Cardinal Roger Etchegaray, who delivered a letter from Pope John Paul II. Etchegaray declined to reveal the letter's contents or the substance of his discussions with Saddam.
"I asked whether all that can be done to guarantee peace has been ... so that Iraq can resume its place in the international community," the cardinal said. He didn't say how Saddam responded.
In Italy, Iraqi Deputy Prime Minister Tariq Aziz urged the world to "resist war and the intentions of aggression."
The U.S. military announced that American warplanes attacked two Iraqi anti-aircraft sites Saturday near Basra in the "no-fly" zone of southern Iraq. An Iraqi military spokesman in Baghdad claimed the bombed sites were civilian installations.