The bodies were mangled from six mortars that pounded the Palestinian compound in central Baghdad.

There was Khaled Mahmoud Al-Fahmawi, 40, who was selling beans when shards tore through his legs and chest; 13-year-old Aisha Ahmed Ishaq, who looked from her balcony for her father; and 19-year-old Muhammad Yusuf Abu Kad, whose intestines spilt from his stomach as he screamed: “I’m dying, I’m dying.”

The assault on the Baladiyat housing compound on December 13 lasted for 45 minutes. The bombardment marked the latest shot in a deliberate campaign to drive out the last of the thousands of Palestinians branded by their association with Saddam Hussein.

Shia militias, most prominently al- Mahdi Army, are targeting Palestinian refugees in Iraq and the Iraqi Government has failed to stop them, a UN official told The Times on condition of anonymity.

The others who died on December 13 were 14-year-old Nour Muhammad Manaa, who had been lounging in her garden when the shrapnel lodged in her throat; Zuhair Massoud Shaaban, 50, who had been playing a game of pool; and 19-year-old Yusef Ahmed Saied, who was sitting by his generator.

The mood is so bleak that the UN High Commissioner for Refugees declared last week after meeting Iraqi officials that there was “little room for optimism”.

Another international relief official told The Times that local police were collaborating with al-Mahdi Army in attacks on Palestinians.

An estimated 19,000 Palestinians have fled the Iraqi capital since 2003 after kidnappings, killings and death threats. The 15,000 who remain are desperate to leave.

But without passports, the refugees, who arrived in Iraq after the 1948 and 1967 wars with Israel, are stranded. Arab countries and the rest of the world are loath to take them. Currently, more than 266 Palestinians are camped out in the desert between Iraq and Syria.

“I wish we could go to another country. Even Darfur is more merciful than being here. There is famine and killing but it’s more compassionate than the Arab countries,” 40-year-old Thamer Asad Melham said. He lives in the Baladiyat housing complex, the biggest Palestinian community in Baghdad, with more than 7,000 residents.

The Iraqi Interior Ministry denied that the Palestinians were being targeted and said that the police were working to protect them.

The seeds of communal hatred lay in the privileged status given to the Palestinians by Saddam. He provided the community, which settled in Iraq in several waves after the creation of Israel in 1948, with government-owned and subsidised housing. In return, he appropriated the Palestinian cause, portraying himself as the defender of Arab nationalism.

The collapse of Saddam’s regime provoked a Shia backlash against the predominantly Sunni Palestinians. Landlords eager for higher rents evicted hundreds of Palestinian tenants. Others viewed the Palestinians as a fifth column for the nascent Iraqi Sunni insurgency. Attacks soon began.

The Shia-led Government’s rhetoric turned openly hostile to the minority community last year. In May 2005, state television broadcast the forced confessions of four Palestinians, claiming responsibility for a car bombing in eastern Baghdad. A year later a judge freed the men, ruling that their confessions had been extracted under torture. The Iraqi Ministry of Migration and Displacement called publicly in October 2005 for the expulsion of all Palestinians from Iraq to the Gaza Strip.

Palestinian leaders claim that at least 150 members of their community have been killed in Iraq since May 2005.

“These Palestinians are refugees twice over. Israel denies them their right to return to their homeland, but Iraq has become a country where they are targeted for violence,” Sarah Leah Whitson, the Middle East director of Human Rights Watch, said.

Residents live under siege in the housing complex in Baladiyat. The community has erected fences and the men stand on guard duty. But they feel nothing can keep them safe. Mr Melham described the aftermath of last week’s mortar strike. Two ambulances came 30 minutes after the attack and the most seriously of the 29 wounded were evacuated to three Baghdad hospitals. But the families of the dead were afraid to take their loved ones to the mortuary, which is guarded by the Shia militia, for fear that the bodies would disappear or that they would be killed when they went to collect them. So they kept the bodies overnight.

They washed away the blood, dressed the corpses in white robes and scented them with perfume. Each body rested on a balcony, where the families could pay their respects. They left all the faces uncovered except for 19-year-old Yusuf, whose head was torn open by shrapnel. Two days later, the familes drove to the Sunni enclave of Adhamiyah, where they buried the bodies at a cemetery.

Mr Melham said that the violence had not let up in the past week. Yesterday, another Palestinian was killed in eastern Baghdad and the body of the recently abducted Palestinian Youth Olympic Committee director was found at the mortuary.

The 40-year-old is living through his own trauma. His older brother, Amar, an accordion player, was left brain-damaged and paralysed after being struck by shrapnel in his skull during a mortar strike on October 19. Mr Melham must change his brother’s nappies and wash him in their two-bedroom apartment, shared by nine people. His brother screams in the middle of the night whenever he hears an explosion.

Yesterday Mr Melham called The Times in a panic. The sound of explosions echoed through the receiver. “You can hear the bullets and clashes. You can hear the mortars falling on us. Please, please save us. This is unjust . . . This is another mortar. You can hear that,” he screamed. “Please call someone to save us. All Palestinians want to leave the country.

Balidiyat is a ghost city.

“We don’t care if we die from the cold. It’s better than staying here.”

The Times is the only British newspaper to maintain a full-time bureau in Baghdad.

Displaced and unwanted

Times Recommends

• Fish and chip shops ‘selling cobbler as cod’
• T in the Park festival at Kinross
• How to get Madonna’s Thighs