By John Davison and Ahmed Rasheed

NASSIRIYA, Iraq, Sept 28 (Reuters) - Elections in Iraq nextmonth are being held early in response to mass protests againstthe government in 2019, but there is scant evidence the votewill improve matters in a country where powerful armed groupsstill hold sway.

Iraqis crave drastic change after years of conflict andcorruption following the overthrow of Saddam Hussein in 2003. Abrutal war to fight off Islamic State that ended in 2017 wasfollowed two years later by protests against the ruling elite inwhich hundreds died.

And as the United States seeks to disengage, Iran retainsdeep influence in one of the region's main oil-producingnations.

Iraq's tortured politics are graphically illustrated in atown square in the south, where weathered portraits displayed onlarge hoardings honour those killed fighting for causes theyhoped would help their country.

The images of thousands of militiamen whose paramilitaryfactions battled Islamic State hang beside those of hundreds ofyoung men killed two years later protesting against the sameparamilitaries.

Defeating Islamic State united Iraqis, who voted victorious militia commanders into parliament at the last election in 2018.

Iraq's next vote on Oct. 10, by contrast, is set to lay baregrowing rifts that have since emerged, none more than among theShi'ite majority that was catapulted to power by the U.S.invasion of 2003.

Shi'ite militia groups backed by Iran are facing off at thepolls against other Shi'ite armed groups that oppose Iran'sinfluence. The activists who took to the streets in protest in2019 are split among themselves, some boycotting the electionand others taking part.

Reuters interviews ahead of the election with across-section of Shi'ites in southern Iraq, as well as Sunnis inthe north, paint a picture of a country whose politicians, armedgroups and communities are more fractured than ever.

"Even within my family we don't agree," said MohammedYasser, a rights activist from the city of Nassiriya, wheresecurity forces gunned down scores of demonstrators in 2019.

"I refuse to vote, others want to vote for reformistparties, and one of my sons is for the Sadrist Movement", hesaid, referring to Shi'ite cleric Muqtada al-Sadr - a populistleader who promises reform but is deeply embedded in the stateand has a militia of his own. urn:newsml:reuters.com:*:nL5N2OB1YU

Some politicians say Iraq is moving forward. The election isbeing held six months early under a new law meant to helpindependent candidates, with 167 parties running, according toIraq's election commission.

Violent sectarianism is less of a feature and security isbetter than it has been for years.

Ordinary Iraqis, foreign diplomats and analysts say thereality is a contest dominated by heavily armed groups whichcontrol state bodies and resources and are willing to resort toforce to retain power. urn:newsml:reuters.com:*:nL2N2O50NL

They say popular resentment over corruption and lack ofpublic services could play into the hands of groups like IslamicState or push more Iraqis to migrate to the West. urn:newsml:reuters.com:*:nL1N2PH0DD

The vote's aftermath will set the tone for the coming years:whether armed groups turn their guns on each other or peacefullydivide the spoils.

"The elections are really important for intra-elitecompetition and the way the elite, without murdering too many oftheir own footsoldiers, shakes out power imbalances," saidProfessor Toby Dodge of the London School of Economics.

Dodge said the fracturing of Shi'ite parties suits Iran aslong as the divisions do not threaten Shi'ite power, which hasbrought Tehran influence in Iraq since 2003.

THREATS AND FEAR

Nassiriya, a flashpoint of anti-government protests, is amicrocosm of Iraq's fracturing political landscape.

Parties hold rallies in halls out of public view and havenot erected campaign posters because protesters tear them down.

Activists running as candidates keep a low profile, scaredof militia groups which officials say are behind a campaign ofmurder and intimidation - something the militias deny.

Candidate Dawood al-Hafathi said splits in the protestmovement had earned him threats from fellow demonstrators whowant to boycott the vote.

"One young protester told me if I win a seat but don't enactimmediate reforms, he'll burn tyres outside my home," Hifathisaid.

The main contest is between Iran-aligned parties with theirmilitias and Sadr, who opposes all foreign interference.

Sadrist officials and Iran-aligned candidates in Nassiriyadownplayed their differences, saying they were mostly stayingout of each other's way ahead of the election.

But one Sadrist official in Baghdad, who requestedanonymity, said he feared violence if his party swept the vote."The Iran-backed side wouldn't allow it. There would befighting," he said.

Fractures have also hit Iraq's northern Sunni provinces andin its autonomous Kurdistan region. Protests in Kurdistan wereviolently crushed last year, alienating many people.

Sunni families suspected of sympathising with Islamic Statestill fear reprisals.

Ibrahim al-Hishmawi, a Sunni living in Kurdistan, said if hewanted to vote, he would have to return to his hometown ofBalad, just north of Baghdad.

"I fled with my family fearing revenge by a Shi'ite tribe inour area," he said. "I'm too scared to go back. What's the pointof risking my life to vote in an election that changes nothing"

(Reporting by John Davison in Nassiriya and Ahmed Rasheed inBaghdad; Editing by Giles Elgood) ((John.Davison@thomsonreuters.com;))