Laura Myers, Jakarta – Secretary of State Madeleine Albright implored Indonesian President B.J. Habibie today not to allow East Timor to break down in bloody violence if the territory chooses independence over remaining an utonomous part of his country.

"A cycle of violence will not lead to a resolution," Albright said, referring to both the question of East Timor's future and June 7 parliamentary elections. "... What we have been supporting is a nonviolent approach and free and fair and open elections."

Habibie, in turn, vowed not to let the territory erupt, as it did in 1975 when the Portuguese abandoned what was then its colony and before Indonesia took over.

"We will not walk away," Habibie told Albright during a nearly two-hour meeting with her at the presidential palace, said a senior US official who was present.

Albright met afterward with Jose Alexandre "Xanana" Gusmao, a separatist East Timorese rebel leader now under house arrest. He revealed to her his blueprint for determining East Timor's future, said the official, speaking on condition of anonymity.

Gusmao suggested elections could be held to select representatives from about a dozen districts in East Timor, which could then each decide whether or not to accept an autonomy plan, now being negotiated with the help of the United Nations, the official said.

In a turnaround from former President Suharto's regime, which fell in May after 32 years of rule, Habibie said earlier this year that East Timor can become independent if a majority of its people reject autonomy. But the government ruled out holding a referendum, fearing it could lead to more violence between separatists and those seeking autonomy.

Gusmao and Albright agreed that whatever mechanism is selected for determining the will of the people of East Timor, an international peacekeeping presence would likely be needed, the US official said, but not necessarily a UN force.

International monitors would ensure combatants are disarmed and they would train new security forces to replace the Indonesian military, often accused of human rights abuses.

Albright told Gusmao, "We want most of all to make sure we don't have this time what happened in 1975" when the Portuguese left East Timor, the US official said.

Albright, in a speech to about 300 Indonesian civic leaders, said Indonesia must not allow violence and unrest between groups, including fighting Muslims and Christians, to knock the nation off its path toward true democratic government.

"For Indonesia has the chance for a new birth in freedom," she said. "Violence is the enemy of democracy, security and prosperity."

Gusmao and Albright met at the Indonesian foreign ministry to avoid dozens of East Timorese activists and journalists gathered outside the small home in central Jakarta where he's been held under house arrest since January.

Gusmao, jailed in 1992 for leading separatists seeking independence for East Timor, asked Albright to press the government to release him and dozens of other political prisoners, some of whom have been held for decades and are now in their 70s.

"All political prisoners must be released," he said Thursday in an interview with The Associated Press. Albright didn't specifically ask for Gusmao's freedom, but she did call for the release of political prisoners during her meetings with Habibie, Foreign Minister Ali Alatas and Justice Minister Muladi, who like many Indonesians uses only one name, US officials said.

"We spoke specifically about the importance of human rights and allowing people the possibility of participating within the various democratic processes," Albright said during a joint news conference with Alatas at the presidential palace.

Habibie's government has suggested Gusmao could be released as part of a plan to ease tensions while deciding whether East Timor, a half-island territory of 850,000 people, should gain autonomy or independence.

In general, Albright had high praise for Habibie's government, saying there has been "a huge improvement" in human rights since Suharto's government troops violently clashed with rioters last year as the Asian financial crisis hit. But she urged the government to further investigate alleged abuses by the military, US officials said.

With nearly 50 political parties qualified to participate in June 7 parliamentary elections, Albright also heralded a "new spirit of democracy that is blossoming here." The voting will lead to selection of a new president by a special assembly later this year.