US Ambassador to Mexico Carlos Pascual speaks at the US embassy in Mexico City in this May 26, 2010 file photo. [Photo/Agencies]

MEXICO CITY- The US ambassador to Mexico has resigned after a public dispute with President Felipe Calderon over the handling of the war against Mexico's powerful drug gangs.

Related readings: 18 killed in clashes between rival gangs in Mexico  At least 17 bodies found in mass graves in Mexico  Mexico to woo more Chinese tourists  7 dead, 1 injured in suburban Mexico City shootout

US Secretary of State Hillary Clinton said on Saturday that she and President Barack Obama had accepted Ambassador Carlos Pascual's resignation "with great reluctance".

The United States and Mexico have long lauded their close economic ties and cooperation on security issues, with more than $1 billion in US aid being funneled to Mexican forces to battle the drug cartels.

But a diplomatic fight erupted after State Department documents published by WikiLeaks showed Pascual criticizing Mexican authorities' lack of coordination in operations targeting cartel leaders.

Calderon lashed out in an unusually critical newspaper interview on Feb 22, saying Pascual had shown "ignorance" and distorted what was happening in the country.

He also said US security forces failed to coordinate their own efforts and saw each other as "rivals".

Calderon is facing increasing pressure in Mexico over his security strategy as the death toll from drug violence has climbed to more than 36,000 since he took office in late 2006.

In a visit to Washington earlier this month, Calderon reportedly requested that Pascual be removed from his post.

Pascual decided to resign "to avert issues raised by President Calderon that could distract from the important business of advancing our bilateral interests," Clinton said on Saturday.

The announcement came as a surprise just as Obama began a five-day trip to Latin America, where he is visiting El Salvador, Brazil and Chile, to shore up ties with the region.

Mexico and the United States trade more than $1 billion a day across their long border and in recent years stepped up intelligence sharing in operations to bring down major drug traffickers.

But the alliance has been strained by the public dispute between Calderon and Pascual and Washington's failure to stop weapons smuggling into Mexico.

A decision to allow unmanned surveillance drones fly over Mexican territory has drawn criticism, with opposition politicians saying it violates Mexico's sovereignt. The killing of a US immigration official in a suspected drug cartel ambush last month also raised tensions.

Pascual, a Cuban-born career diplomat with more than two decades of service, recently began dating the daughter of a senior figure inside Mexico's main opposition party. That also could have raised concerns inside Calderon's team.

Calderon's conservative National Action Party is struggling in polls ahead of a presidential election next year.