Islamic militants have captured Iraq's northern capital, Mosul, in a devastating defeat for the Iraqi Government, whose forces fled the city, discarding weapons and uniforms.
The victory by the Islamic State of Iraq and Syria (Isis) is likely to transform the politics of the Middle East as foreign powers realise that an al-Qaeda-type group has gained control over a large part of northern Iraq and northern Syria.
The US said it supported a "strong, co-ordinated response to push back against this aggression".
An Iraqi army colonel admitted: "We have lost Mosul this morning. Army and police forces left their positions and Isis terrorists are in full control."
As well as police stations, army bases and the airport, the insurgents have captured two prisons and freed 1200 prisoners, many of them Isis fighters. Roads out of Mosul are choked with refugees heading for what they hope is safety in Kurdish-held territory.
In Baghdad, the Prime Minister, Nouri al-Maliki, has asked Parliament to declare a state of emergency and called on the international community to support Iraq in its fight against "terrorism".
But in the capital, where the population is mostly Shia, there is growing panic and fear that Isis forces may take the Sunni city of Tikrit and then move on to Baghdad.
One woman in Baghdad said: "People are buying up food and may not come to work tomorrow because they think the situation is going to get worse."
She added that her relatives in Mosul who had been living in the western part of the city have moved to the eastern side that is defended by resolute Kurdish Peshmerga troops. She said: "People in Mosul have seen government forces run away so they think the Government will use aircraft to bomb Mosul indiscriminately."
Isis has grown swiftly in strength over the past three years under the leadership of Abu Bakr al-Baghdadi, known as Abu Dua, who took over in 2010 after its previous commanders were killed.
Its propaganda films often show non-Sunni Muslims being executed and its reputation for savagery may have helped demoralise the Iraqi security forces in Mosul.