Iraq's cabinet wants changes to a draft agreement that would allow US forces to stay until 2011.
The announcement effectively reopens negotiations which had led last week to the unveiling of a draft that would require US forces to leave Iraq by the end of 2011. The objections appear to be about details rather than the broad thrust of the pact.
"The cabinet has agreed that necessary amendments to the pact could make it nationally accepted," government spokesman Ali al-Dabbagh told Reuters after a cabinet meeting.
"The cabinet will continue its meetings (in coming days), in which ministers will give their opinions and consult and provide the amendments suggested. Then this will be given to the American negotiating team."
The announcement was an apparent reversal for Baghdad, which had previously described last week's draft as a final text and said as recently as Saturday that it was unlikely to be renegotiated. Political leaders from most parties withheld their support for the text at a meeting Sunday.
The draft would require US troops to leave Iraq after 2011 unless Baghdad asks them to stay. It also allows Iraqi courts try US service members accused of serious crimes while off duty.
It would mean that the foreign troops, which now operate under a UN Security Council mandate, would function for the first time under the authority of the elected government in Baghdad. Both sides call it a milestone for Iraqi sovereignty.
But some Iraqi politicians have expressed reservations over details such as the mechanism for holding trials of US troops.
Only Kurdish groups have so far given the text full support.
Humam Hamoudi, a leading member of parliament from the Shia alliance, said that among those voicing doubts in recent days was Prime Minister Nuri al-Maliki, who has yet to speak about the pact in public.
"The prime minister said: what (the Americans) have given with the right hand they have taken away with the left hand," Hamoudi told a news conference. "For example, they said the US forces will withdraw from towns by June 2009 if the security situation permits that. But who will decide that?"
Maliki's Shia rivals strongly oppose the pact, as does the leadership of mainly Shia Iran, which has influence among Iraqi Shias and says the pact would give US forces a long-term foothold in the region.
A senior, non-Shia government source said the delay was prompted by Shia politicians under Iranian pressure.
"It seems there was a (Shia) alliance decision to reject it," he said. "I can only explain these Shia delaying tactics by Iranian pressure. There's no other explanation, especially as it's the Shias who negotiated it in the first place."
US officials say they are happy with the current draft and have not said whether they would be willing to renegotiate it.
"(The Iraqis) are looking at the text, they are having discussions about it and that is part of the process," said US embassy spokeswoman Susan Ziadeh.
Officials in the administration of President George W. Bush briefed members of Congress - including the two main presidential candidates - about the contents of the draft on Friday. The pact does not require congressional approval, but the administration is seeking broad political support for it.
Iraq's Foreign Minister Hoshiyar Zebari, a member of one of the Kurdish groups that backs the draft, acknowledged its troubled reception Monday and said the pact was now unlikely to pass before the US presidential election on November 4.