U.S. Defense Secretary Donald Rumsfeld and his British counterpart, John Reid, made the appeal at a joint press conference in Washington Thursday.
One of the main sticking points is Iraqi Prime Minister Ibrahim al-Jaafari, who is refusing to step down as the Shi'ite nominee for a second term -- unless asked by parliament.
Iraq's Kurdish and Sunni Arab leaders say he has not done enough to ease sectarian violence in the country.
At least 10 people were killed Thursday in a car bomb blast near a Shi'ite Muslim shrine, the tomb of Imam Ali in the city of Najaf, south of Baghdad.
A U.S. State Department spokesman, Sean McCormack condemned the attack, saying those who target Iraq's religious sites are enemies of all faiths and all humanity.