American forces fought their way into Baghdad almost two weeks ago. The palace grounds where the funds were found is controlled by Second Brigade of the Third Infantry Division, which led the Army assault on the Iraqi capital.

The money had been placed in a small structure that American forces passed numerous times and would never have inspected had soldiers not been looking for a chainsaw and other tools to fix up their compound.

After the funds were discovered, the military police hauled away three truckloads of the containers on Friday night. Five of the boxes were opened and when Maj. Gen. Buford C. Blount III, the commander of the Third Infantry Division came in today, he ordered that one more be picked at random and opened. As with the other opened boxes, it contained $4 million.

How Mr. Hussein's officials intended to use the money remains a mystery, but it may be that the funds, like the furniture and paintings from some of his palaces, were moved from potential targets and hidden in the expectation that Mr. Hussein would survive the war and retain power. Inside the opened boxes were orderly piles of United States $100 bills wrapped in plastic. The packs of cash bear the markings of the Federal Reserve Banks of New York, Boston and Philadelphia. Most of the bills are brand new, and the serial numbers run in sequence. But some of the bills appear to be used. There is paperwork inside indicating, officials said, that the funds were taken from the Bank of Iraq after their transfer from the Bank of Jordan.

''We have run across currency before, but nothing like this,'' said Master Sgt. David James, the operations noncommissioned officer for the provost marshal's office. ''To see the way the people of Iraq live and then to see so much cash, it's insane.''

These are not the only funds that the military police here are securing. They have $6.3 million more in cash that was seized when American forces stopped a bank robbery in Baghdad. That money is being added to the shipment of funds being flown from here tonight.

The official value given by officials for all the money being shipped is $661,893,800.

Bonds depicting Saddam Hussein's likeness were also discovered, but these are likely to be of interest primarily to war buffs and historians.

An Army finance officer, Maj. Rod King, came to the site today to make sure that the accounting was in order. ''Most people don't think of finance on the battlefield,'' he said. ''But there is a role in this conflict, and it appears we will continue to receive captured currency. We have not secured funds like this since World War II.''