Islamic groups condemned the strike across Pakistan

There were angry scenes as they were buried - with denunciations of Monday's attack by Islamists, who say most of the 70-80 people who died were pupils.

But officials insist the victims were fighters. The raid occurred in a remote tribal area near the Afghan border.

The region is said to provide refuge for al-Qaeda and Taleban militants.

A local leader with suspected links to al-Qaeda, Faqir Mohammed, addressed a crowd of 10,000 mourners.

"The government attacked and killed our innocent people on orders from America," he is quoted as saying by the Associated Press news agency.

"It is an open aggression."

Thousands took part in protests against Pakistan's alliance with the US, chanting "Death to Bush" and burning American flags, the Associated Press news agency reported.

A cabinet minister from Pakistan's North West Frontier Province, Siraj ul-Haq, said he would resign in protest at the strike.

"This is a very wrong action. They [the victims] were not given any warning," Mr ul-Haq told AP.

No deal

There was widespread condemnation of the air strike from Islamic groups in other parts of Pakistan, including Peshawar and Lahore.

The MMA, a coalition of religious parties, called a protest on Tuesday in Karachi, the country's largest city.

The army said the religious school, or madrassa, was used as a military camp.

Army spokesman Gen Shaukat Sultan said the strike that destroyed it had killed militants only. "There was no collateral damage," he said.

The attack came as the government was due to sign a peace deal with pro-Taleban militants in the area, which now appears to have failed.

There is sympathy for the Taleban and al-Qaeda among tribesmen in Bajaur and that is believed to translate into active support, the BBC's Barbara Plett in Islamabad says.

Pakistan has deployed nearly 80,000 troops along the border.

They are there to hunt militants who sought refuge after the ousting of the Taleban in Afghanistan in 2001.

'Saddened'

President Pervez Musharraf has pledged to reform madrassas after many were criticised for supporting Islamic militancy.

The leader of the madrassa, radical cleric Maulana Liaqat, was among the dead.

At least three helicopters were reportedly involved in the attack

An eyewitness told the BBC that the madrassa was filled with about 80 local students who had resumed studies after the Muslim Eid holidays.

Journalists trying to get to the scene were being turned back as they tried to enter the Bajaur region.

The attack came two days after local militants attended a rally in the area where they declared the al-Qaeda leader Osama Bin Laden and Taleban chief Mullah Muhammad Omar as their heroes.

Bajaur, which borders Afghanistan's insurgency-plagued eastern province of Kunar, was the scene of a controversial US air strike in January, believed to be aimed at al-Qaeda number two Ayman al-Zawahiri.

The 13 January raid killed at least 18 people, mostly civilians.

In May, Pakistani authorities said a senior al-Qaeda figure, Abu Marwan al-Suri, had been killed in Bajaur during a clash with local police.