LOS ANGELES (AFP) - IRAQ war drama 'The Hurt Locker' is set for an Oscars shoot-out with science-fiction epic 'Avatar' here on Sunday as the movie world descends on Hollywood for the 82nd Academy Awards.

The streets around the Kodak Theater had been cordoned off and the red carpet had been rolled out as organizers fine-tuned preparations for Sunday's showbusiness spectacular, which gets under way at 5.00 pm (7 am Singapore time on Monday). The critically acclaimed 'Hurt Locker,' about a bomb disposal squad in Baghdad, has emerged as a clear favorite after winning a string of awards seen as key indicators of likely success.

But the movie's momentum has been shaken in the home stretch after a string of embarrassing scandals over illegal campaigning which has led to one of its producers being banned from Sunday's ceremony.

The film, which is nominated for nine Oscars along with 'Avatar,' has also faced stinging criticism from veterans about its portrayal of soldiers, as well as a lawsuit from a serviceman alleging he was the inspiration for the movie.

Although Oscars organizers doubled the field of best picture nominees to 10 this year, most analysts see the contest as a two-horse race between 'The Hurt Locker' and 'Avatar,' James Cameron's blockbuster which is the highest grossing film in history with more than 2.5 billion dollars in earnings.

The race has been given added spice by the fact that 'The Hurt Locker' was made by Cameron's ex-wife Kathryn Bigelow. Bigelow, 58, is also favorite to pip her former spouse for the best director Oscar, which would make her the first woman in history to win the award. 'No matter what happens in the best picture race I don't think Kathryn Bigelow is going to be denied,' said Maxim Film critic Pete Hammond. 'It's too irresistible a story.'

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