'Operation Swarmer' comes as Iraq's divided political leaders failed again in talks to reach a breakthrough in efforts to form a government seen as vital to avert sectarian civil war.
Signs of movement to end the paralysis have emerged as US and Iranian officials said they could set aside years of hostility to discuss stabilising Iraq, where Tehran has gained influence with ties to fellow Shi'ites in power.
US military officials said Operation Swarmer, involving 50 helicopters, was the biggest "air assault" since a similar airlift across Iraq just after the war in late April 2003. That operation was also by the 101st Airborne Division.
Military spokesman Lieutenant-Colonel Barry Johnson said US-led forces are searching a 16-km by 16-km area for guerrillas and no casualties have been reported by American or Iraqi forces.
He said 50 people have been detained and 30 remained in custody.
The operation, just ahead of the third anniversary of the US-led invasion that toppled Saddam Hussein, appears to be the latest US effort to show Iraqi troops are improving their performance against insurgents. A US troop withdrawal hinges on whether Iraqi troops can improve their skills.
No sign of Progress
Iraqi political leaders met for another attempt to bury their differences but there was no sign of any progress as Shi'ite, Arab Sunni and Kurdish leaders stood in front of the cameras for a news conference.
The operation seems to have created a new disagreement among Iraqi politicians as they emerged from the news conference.
Sunni leader Tareq al-Hashemi said military escalation was harmful during a political crisis, only to hear Shi'ite politician Hussein al-Shahrastani beside him immediately say any attacks on "terrorism" were justified.
Iraqi Defence Ministry spokesman General Salih Sarhan criticised the attention being given to the assault, describing it as one of many operations aimed at rooting out rebels and seizing weapons.
Meanwhile there are mixed messages coming from the US regarding Iran’s role in Iraq.
US Secretary of State Condoleezza Rice told a news conference on a trip to Australia that she believed talks with Iran on stabilising Iraq would be "useful".
However the US embassy in Baghdad issued a statement accusing Iran of meddling in its neighbour's internal affairs, saying the Islamic Republic was carrying out "unhelpful activities" there.
The statement was issued one day after Iran said it accepted a proposal by leading Iraqi Shi'ite leader Abdul Aziz al-Hakim to open a dialogue with the US on Iraq.
Sunni Arab leaders, deeply suspicious of ties between Teheran and Iraq's Shi'ite leaders, rejected the proposed talks.
"The Iraqi Accordance Front strongly condemns it and considers it as meddling in the Iraqi issue which is unjustified," the biggest Sunni bloc said. "We will not commit to any results of these talks."
Latest violence
Meanwhile in the latest violence a suicide bomber stepped into a bus and detonated his explosives belt, killing the driver and wounding four passers-by, police said.
Police said three bodies with bullet holes in the head and signs of torture were found in the capital, apparently part of the latest wave of sectarian violence that has left more than 100 corpses dumped in the capital alone since Monday.
South of Baghdad in Mahmudiya, in an area known as the Triangle of Death for its insurgent attacks, two Shi'ite pilgrims walking to the sacred city of Kerbala were killed in a roadside bomb attack, police said. Another roadside bomb killed a policeman in nearby Latifiya, police said.