Robert Frowick, the US official in charge of the 14 September elections, said that he was delaying the start of the campaign until Friday to provide time for solving the Karadzic problem. He emphasised that he would not allow Mr Karadzic's ruling Serb Democratic Party (SDS) to participate in the elections as long as the United Nations indicted war criminal remained the SDS leader. The postponement coincided with a trouble-shooting visit to former Yugoslavia by Richard Holbrooke, the former US diplomat, who brokered last year's Dayton peace settlement.
US officials said Mr Holbrooke's priority would be to "read the riot act" to Serbia's President, Slobodan Milosevic, who is widely viewed as having enough influence to secure Mr Karadzic's removal.
Mr Milosevic's relations with the Bosnian Serb leadership have been poor for more than three years, but he kept contact with Mr Karadzic and the Bosnian Serb military commander, General Ratko Mladic, also an indicted war criminal. Mr Milosevic's aim appears to be a deal with Bosnian Serb leaders and the international community that would allow Mr Karadzic and Mr Mladic to slip quietly into retirement while avoiding prosecution at the UN tribunal in The Hague.
However, it seems unlikely that Mr Milosevic will secure any guarantees of non-prosecution from Mr Holbrooke, since that would fly in the face of US government policy and the ex-diplomat believes firmly that the two Bosnian Serb leaders must stand trial. There is equally relentless pressure for a trial from the tribunal, which issued arrest warrants for Mr Karadzic and Mr Mladic last week, and from Western governments whose Bosnia policies would be discredited if the leaders escaped justice with the West's connivance.
France said on Sunday that it intended to ask the UN Security Council to authorise Nato forces in Bosnia to pursue and arrest indicted war criminals. Meanwhile, the ruling Bosnian Muslim SDA party of the Bosnian President, Alija Izetbegovic, could boycott the elections if Mr Karadzic and Mr Mladic stay in power.
However, the police chief in Pale, Mr Karadzic's political base outside Sarajevo, has warned that the Bosnian Serbs will strike at Nato forces if the two leaders are arrested. Such threats are increasing tension in the run-up to the election and underlining the difficulties of ensuring it will be free and fair.
Western governments have insisted that the elections should go ahead in mid-September on the grounds that postponement could cause the Dayton settlement to unravel. However, with Muslim, Croat and Serb nationalist parties dominant in areas populated by Muslims, Croats and Serbs respectively, there is a risk that the elections will reinforce Bosnia's de facto partition and prevent the restoration of a unitary Bosnia-Herzegovina.
The chief aim of Mr Karadzic, who is still the dominant political figure in Republika Srpska, the Serb-controlled sector of Bosnia, is to consolidate his region's "statehood" and prevent Bosnia's re-emergence as a common state. Since this aim is shared by most other Bosnian Serb politicians, and a sizeable proportion of the Bosnian Serb people, it may make little difference if Mr Karadzic plays no part in the election.
Another obstacle to the implementation of the Dayton accords is the dispute over the Serb-held corridor of Brcko in northern Bosnia. The Serbs want the corridor widened to strengthen the link between the two halves of Republika Srpska, but the Muslim-led government wants the entire territory for itself.