After a year-long inquiry, the panel warned in a scathing report that the decision to invade Iraq in March 2003, based on accusations that turned out to be false, had done damage to US credibility that "will take years to undo."

"We conclude that the intelligence community was dead wrong in almost all of its pre-war judgments about Iraq's weapons of mass destruction," the commission said. "We simply cannot afford failures of this magnitude."

The panel warned that US intelligence on the capabilities and intentions of Iran and North Korea -- both locked in nuclear disputes with the United States -- may be "disturbingly" shaky. A chapter on the subject was classified.

US President George W. Bush welcomed the report and said he had directed his homeland security adviser, Fran Townsend, to review the 600-page document over the next 90 days and take "concrete action" on its recommendations.

"The central conclusion is one that I share: America's intelligence community needs fundamental change to enable us to successfully confront the threats of the 21st century," he said in remarks at the White House.

The panel called for bolstering the powers of the newly created director of national intelligence -- former US ambassador to Iraq John Negroponte awaits confirmation to that post -- as part of creating more centralized management and integrating what it described as a loose grouping of independence agencies.

But they warned that Negroponte faced an uphill battle in his dealings with "headstrong" agencies like the Pentagon, the Federal Bureau of Investigation (FBI), and the Central Intelligence Agency (CIA).

"To win the war on terror, we will correct what needs to be fixed," Bush said with the commission's co-chairman, former federal judge Laurence Silberman and ex-senator Charles Robb, at his side.

In a separate letter, Silberman and Robb criticized the pace and scope of overhauls at the FBI and CIA and warned that those agencies would resist reform efforts by the national intelligence director.

The report took the US intelligence community severely to task for a series of shortcomings it said led to the false conclusion that Saddam Hussein possessed weapons of mass destruction, justifying the 2003 invasion of Iraq.

Analysts stuck to assumptions about Iraq developed after the 1991 Gulf War, as well as data collection problems and the failure to tell policymakers just how little hard intelligence they really had.

"What little evidence they did have, which was inconsistent, was tortured into those presumptions," Silberman told reporters.

The commission report said it found no evidence that political pressures had warped US intelligence findings on Iraq, but steered clear of whether the Bush administration had exaggerated the intelligence to sell the war.

At the same time, the panel said that flaws that crippled analysis of Iraq "are still all too common" and warned that US intelligence on countries like Iran and North Korea lacks critical information.

"The bad news is that we still know disturbingly little about the weapons programs and even less about the intentions of many of our most dangerous adversaries," the commission said.

"Across the board, the intelligence community knows disturbingly little about the nuclear programs of many of the worlds most dangerous actors. In some cases, it knows less now than it did five or 10 years ago," it said.

Bush indicated that he still believed in "preemptive" military action to counter rising threats, and White House spokesman Scott McClellan said there were no plans to change US policy toward Tehran or Pyongyang.

Tehran denies the charge that its civilian nuclear program hides a quest for atomic weapons. North Korea boasts that it has nuclear arms.

The commission warned that the US intelligence community "has not kept pace" with the spread of weapons of mass destruction and eagerness among terrorists like those behind the September 11, 2001 attacks to get them.

The presidential commission had some good news on at least one front, praising "innovative" US intelligence efforts on Libya's now-abandoned nuclear arms program as "fundamentally a success story."

It said the use of new techniques to penetrate the global sales network of Pakistan's disgraced nuclear scientist Abdul Qadeer Khan "allowed the US government to pressure Libya into dismantling these programs."

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