MIAMI - One million Cubans marched in Havana on Tuesday demanding Washington arrest an accused Cuban airliner bomber who emerged from hiding in Miami, highlighting a dilemma for Washington in its war on terrorism.

Luis Posada Carriles, whose whereabouts had been a mystery since he slipped into the United States two months ago from Mexico, denied in a Miami Herald interview any involvement in the 1976 bombing of the Cuban plane that killed 73 people.

The presence in the United States of Posada, a former CIA collaborator and longtime anti-communist activist, has presented U.S. authorities with the dilemma of how to reconcile its sympathy for politically influential Cuban exiles with Washington's firm stance against terrorism suspects after the Sept. 11, 2001, attacks on the United States.

Castro, at odds with the United States since soon after his 1959 revolution, has furiously charged Washington with hypocrisy. Communist-run Cuba is one of six countries designated a state sponsor of terrorism by the U.S. Department of State -- Havana denies it has backed international terrorism and believes this is a politically-motivated charge.

Castro led a massive protest march -- organizers put the crowd size at 1.2 million people -- past the U.S. diplomatic mission in Havana on Tuesday to demand that the Bush administration arrest Posada. "Bush, fascist, capture the terrorist," the crowd chanted.

In five weeks, Castro has spoken 16 times to the nation about Posada in live television broadcasts lasting up to four hours, his biggest campaign since the successful battle for the return of shipwreck victim Elian Gonzalez five years ago.

The Miami Herald interview was the first in several media appearances by Posada that could put pressure on the U.S. government to state its position on him.

The Miami Herald said it was arranged through "cloak-and-dagger" instructions from Posada's contacts in south Florida, and while Posada did not say where he was living, he did say he had become more relaxed about being seen.

"At first I hid a lot," said Posada."I thought the (U.S.) government was looking for me," he told the newspaper.

"Now I hide a lot less. People have recognized me in the market, at the doctor's office, mostly older people."

In Washington, Justice Department officials, who said last week they were reviewing Venezuela's request to arrest and extradite Posada, declined to comment when asked if there were any imminent plans to arrest him.

Immigration officials from the Department of Homeland Security also refused to comment.

Posada also appeared before several Miami media on Tuesday morning and acknowledged that his presence could pose a problem for Washington.

"If my petition for political asylum could create any problem for the government of the United States of America, I am willing to reconsider that petition," he said. "My only objective is to fight for the freedom of my country."

VENEZUELA'S EXTRADITION REQUEST

Hugo Chavez, Venezuela's president and a close ally of Castro, last week asked the United States to extradite Posada, who has Venezuelan citizenship and who lived there at the time of the plane bombing.

Venezuela requested the Bush administration hunt down the 77-year-old, and deport him to face trial for the bombing. He was arrested in Venezuela more than 20 years ago but escaped from prison without being convicted.

Venezuela's Interior Minister Jesse Chacon on Tuesday called on Washington to honor a bilateral extradition treaty and deliver up Posada. "This person is a terrorist, there is no other name for him ... the ball is in Mr Bush's court," Chacon told a news conference.

U.S. State Department Counselor Philip Zelikow told lawmakers last week the plane bombing was an act of terrorism and U.S. authorities were gathering evidence about Posada's suspected role to determine how to treat any asylum request.

But U.S. authorities have apparently made no move to detain Posada since his lawyer said a month ago he was in the United States.

Asked by the Miami Herald if he took part in the Cuban plane bombing, Posada said "They accused me of being the intellectual author of fabricating a weapon of war and of treason to the homeland. No one saw me make a bomb."

He did not confirm or deny a role in a series of bombings of hotels in Cuba in 1997, which killed an Italian citizen. Asked by the newspaper if he denied organizing the bombings, Posada shook his head and said "Let's leave it to history."

He said he traveled to the United States because he feared Cuban government agents were close to killing him.

Posada was freed last August from a Panama prison after outgoing President Mireya Moscoso pardoned him in connection with an alleged plot to kill Castro in 2000. He said he ended up in Guatemala and from there went through Belize to Mexico, crossing into the United States in a vehicle with a migrant smuggler at the Texas border at Brownsville.

Posada said he was nearly caught on a Greyhound bus journey to Miami by authorities but managed to persuade immigration officials who boarded the bus he was just a harmless old man who had forgotten to bring his papers.

Posada said he was prepared to be detained if and when he had to appear for his asylum interview.