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The U.S. Consulate in Benghazi is seen in flames by an armed group said to have been protesting a film being produced in the United States Sept 11, 2012. An American staff member of the U.S. Consulate in the eastern Libyan city of Benghazi has died following fierce clashes at the compound, Libyan security sources said on Wednesday.ESAM OMRAN AL-FETORI/Reuters

An armed mob protesting against a film they said offended Islam attacked the U.S. consulate in Benghazi with rocket grenades on Tuesday and set fire to the building, killing one American, witnesses and officials said.

Libya's deputy interior minister, Wanis al-Sharif, told Agence France-Presse: "One American official was killed and another injured in the hand. The other staff members were evacuated and are safe and sound." He could not say if the dead man was a diplomat.

The attack happened on the same day as a similar group of hard-liners waving black banners attacked the U.S. embassy in Cairo and tore down the American flag, but it was not immediately clear if the two incidents were co-ordinated.

In Cairo, nearly 3,000 demonstrators gathered at the embassy in protest over a film, produced in the United States, deemed offensive to the Prophet Mohammed. Muslims consider any depiction of the prophet as sacrilegious.

The protests came on the 11th anniversary of 9/11, when U.S. cities were targeted by hijacked planes.

The film at the centre of the anti-U.S. protests in Egypt and Libya was made by an Israeli-American who describes Islam as a "cancer," the Wall Street Journal reported Tuesday.

The movie, Innocence of Muslims, was directed and produced by Sam Bacile, a 52-year-old real-estate developer from Southern California who says Islam is a hateful religion.

"Islam is a cancer," Mr. Bacile told the newspaper.

Earlier it had been reported that the film the protesters were targeting was produced by expatriate members of Egypt's Christian minority living in the United States.

But Mr. Bacile told the Wall Street Journal he was responsible for the film, saying he had raised $5-million to make it from about 100 donors, whom he declined to identify.

He said he had worked with some 60 actors and 45 crew members to make the two-hour movie in a three-month period last year in California. "The movie is a political movie. It's not a religious movie," he said.

It is being promoted by controversial Florida pastor Terry Jones, who has drawn protests in the past for burning the Koran and vehemently opposing the construction of a mosque near ground zero in New York.

Mr. Jones said he planned to show a 13-minute clip of the film Tuesday evening at his church in Gainesville, Fla.

"It is an American production, not designed to attack Muslims but to show the destructive ideology of Islam," he said in a statement cited by the Wall Street Journal. "The movie further reveals in a satirical fashion the life of Mohammed."

A spokeswoman for Mr. Jones, Fran Ingram, said she could not confirm who produced the film but said that a clip of the contentious film would be screened.

"They're going to show that trailer, the one that they're angry about right now in Egypt. It's a life of Mohammed. It's kind of a satire," she told AFP.