MOGADISHU, July 21 - Islamist leaders called on Friday for Somalis to prepare for war, as residents said Ethiopian troops were moving closer to Mogadishu, seat of the Muslim militia now holding much of the Horn of Africa nation.

"Somalia is under attack and Somalis must defend their country," senior Islamist leader Sheikh Sharif Ahmed said.

"Anybody who sides with Ethiopia will be considered a traitor... The Islamic courts will lead the people to victory."

The call came as thousands took to the streets of Mogadishu to support their new Muslim rulers and protest a reported incursion by Ethiopian troops into Somalia to protect the interim government from Islamist forces.

In a procession of pickup trucks, cars and motorcycles, residents toured the battle-scarred city, which the Islamists took from U.S.-backed warlords last month. Onlookers cheered and clapped as rally organisers led the convoy through areas previously held by warlords.

The rapid rise of the Islamists who established their base through sharia courts has threatened the authority, and indeed existence, of President Abdullahi Yusuf's government, formed in 2004 to steer the nation of 10 million from anarchy to peace.

Western nations back Yusuf's government in principle, but recognise it has little political or military power.

Outside the capital, residents said Ethiopian soldiers were moving beyond the fragile Somali interim government's provincial base in Baidoa to the towns of Buur Hakaba and Baledogle.

Addis Ababa denied that, while the Somali government, which has little authority beyond Baidoa, said people were confusing its militia because they wore uniforms given by Ethiopia.

WAR?

Traditionally Christian Ethiopia, the Horn's main power, supports the interim government and views the Islamists as "terrorists". It has not hesitated to send troops in to attack radical Islamic militia in the past.

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