Iraqi Christians who returned to their ancient city after a wave of violence and intimidation are in shock today after two sisters were stabbed to death when attackers broke into their home.

Lamyaa Sabih and her sister, Walaa, died from their injuries sustained at the house early Wednesday morning in the Alqahira residential area of the northern city of Mosul.

Their mother, who lived with them, was also stabbed and is now in a critical condition in hospital.

Police rushed to the scene and on arrival a security car was bombed. Three policemen were killed and the Sabih family's house was badly damaged.

So far, nobody has claimed responsibility for the attack, which took place in Alqahira's Al Nien district.

The sisters, both in their 40s, and who had worked for a local provincial council since the 1980s, were known to be devout Syrian Catholics.

Initial reports received by Aid to the Church in Need (ACN), the charity for persecuted and other suffering Christians, show how the incident has sparked fear and panic within the Christian community at a time of heightened anxiety about their safety.

Christians and other minorities are saying that the incident casts doubt on the Iraqi government's bid to improve security with a massively increased police presence in the city.

The extra police were sent in after a campaign of violence and intimidation against Christians last month prompted a mass exodus of more than 2,000 families from Mosul.

After repeated government assurances about improved security, people started to return to Mosul and it is now reported that up to 500 families have gone back over the past two weeks.

Speaking from northern Iraq in an interview with ACN, Fr Bashar Warda, who has overseen the charity's emergency relief programmes for people fleeing Mosul, said today's incident was having a "dramatic" effect on the faithful, who now fear another wave of attacks against them.

Fr Warda said: "It is clear that many would think of leaving Mosul again. The government is trying to say that the city is now safe and then suddenly you have incidents like this."

He stressed how the incident had taken place in a region of tight security.

Fr Warda said: "The police have acted very speedily to calm the situation but it is clear the attackers knew what they were doing."

Iraqi Christian leaders say the attack shows the government is failing to deliver on its promises to deliver peace and security for vulnerable church communities lacking militia and other means of self protection and whose only option in times of crisis is to flee.

They are demanding the West intervene on their behalf, insisting on the protection not just of Christians but of all minority groups in Iraq.

One local Catholic leader said: "The government is trying to fool the outside world into thinking it is doing good things and that the Christians are safe. In reality the situation is really very challenging."

Christians across the region have appealed for prayer and a return to peace and stability.

The incident comes after a series of setbacks for Christians in Iraq climaxing with last week's decision by the Iraqi parliament to offer them just three seats in the provincial elections of 31 January 2009, 10 fewer than proposed in Article 50, which was dropped from a draft electoral bill in September.