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BRIANNA KEILAR: Surrounded and bombarded by U.S. and Iraqi troops for weeks now, Sadr City has been ground zero in the military struggle against hardcore Shiite fighters. Civilians were trapped, with movement next to impossible, but our Michael Ware managed to get the ultimate insider's view. This is an exclusive tour with the Mehdi army militia.

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MICHAEL WARE, CNN CORRESPONDENT (voice-over): They called it the siege of Sadr City.

(on camera) You can hear the sound of the gunfire now. We're being signaled to cross the street.

(voice-over) For almost 50 days until a weekend cease-fire agreement, two million people were virtually encircled in this Baghdad slum by U.S. and Iraqi troops targeting Mehdi army militia fighters. It was with those Mehdi army fighters that we visited the besieged Sadr City in the combat's last days. They wouldn't let us show their faces, but with this rare access, we could gauge the conflict for ourselves.

(on camera) What we're seeing now is a blast wall just recently erected by the Americans to separate parts of Sadr City. It's down here that the Americans say many of the rockets fired at the Green Zone are launched and that's why they're trying to seal it off.

(voice-over) The fighting has mauled this neighborhood.

(on camera) So 11 people are supported by the income he makes from this shop and you can see the destruction all through it. The bullet holes have absolutely peppered it, passing from one side down there, through the shop. And you can see how this wall is absolutely riddled, even this barrel, full of bullet holes.

And it fits the street behind me: destroyed cars, bombed buildings. This is very much the front line in Sadr City.

(voice-over) Sadr City is a bastion for loyalists of anti-American cleric Muqtada al Sadr, his Mehdi army the focus of a government military offensive cautiously backed by the U.S. military. Al Sadr's religious and military leaders claim up to 1,000 people have died in less than seven weeks. Impossible to say how many were combatants, how many were civilians. Others are homeless with food and medical supplies running short.

Yet, 24 hours before the peace accord, the skirmishes continued.

(on camera) You can smell the cordite in the air right now from the gun shots, they're that close. We're in a safe zone right now. We're out of the direct line of fire, but we're very, very close to a clash that's underway as we speak.

(voice-over) This family's neighbor's house was pummeled by U.S. bombs.

(on camera) One week ago, the house here was destroyed.

(voice-over) This man survived that bombing but says 11 of his family did not. "We want the siege of the city to finish," he says. And though the siege has eased for now with the weekend's tentative cease-fire, on Friday, the wounded were still descending upon Sadr City Hospital. And the week's dead, including a 12-year-old boy, were awaiting collection.

Meanwhile, thousands gathered for Friday prayers at the mosque, chanting, "Long live al Sadr. The Mehdi army is victorious." To many, like this Sadrist parliamentarian, the military offensive is a bid by Shia rivals to undermine al Sadr before local elections.

"The provincial elections are the target of this operation," he says, "because the provincial winners will impose or reject Federalism" -- a suspicion U.S. commanders share. Few want the Iraqi government dragging them into a street fight in a Sadr City teeming with a hostile population.

(on camera) If American troops do have to enter these streets, the concern, a top American officer told me, is that the fight could be like Mogadishu.

(voice-over) But even before the cease-fire was struck, on Friday, al Sadr's top aide in Sadr City laid out the terms, telling me the Mehdi army would allow Iraqi army units -- not American -- to enter the slum, while the militia would maintain its right of self-defense, a right it vigorously exercises. Its forces dominate each intersection, its members disciplined and well organized. And with calls for the Mehdi army's disbandment now dropped, they may be even stronger than before.

Michael Ware, CNN, Sadr City.