The director of the US Federal Emergency Management Agency, Michael Brown, has been removed from relief operations on the Gulf Coast.
Mr Brown had faced calls to resign over the sluggish federal response to the disaster.
Homeland Security Secretary, Michael Chertoff, is bringing Mr Brown back to Washington and putting the Chief of Staff of the US Coast Guard, Vice Admiral Thad Allen, in charge of operations.
Meanwhile, NATO has announced that alliance ships and aircraft will be used to help deliver European aid to hundreds of thousands of victims of Hurricane Katrina.
Up to three ships are being sent to deliver bulky gear such as water pumps and engineering equipment, while Boeing-707 jets will deliver smaller items.
The announcement came as US security forces stepped up efforts to evacuate the remaining inhabitants of New Orleans. Many people had refused to leave in the wake of the hurricane despite a compulsory evacuation order.
Initial sweeps of the city have indicated the death toll may not be as catastrophic as first believed. Earlier estimates had put the toll as high as 10,000.
With 14,000 troops on patrol, a city official has claimed New Orleans is now fully secure and officials hope to restore power to the city's central business district within seven days.
In a separate development, the former US Secretary of State, Colin Powell, has added his voice to those criticising the initial rescue effort.
In a television interview to be broadcast later today, Mr Powell said he could not understand why more preparations had not been made to cope with the storm.
Mr Powell claimed poverty rather than racism was the reason so many black citizens of New Orleans were left unprotected.
And he said it should have been blindingly obvious that when an evacuation is ordered, not everyone can be expected to get out on their own.
Congress approves $51bn aid request
Last night, both houses of the US Congress approved an emergency request from the US President, George W Bush, for a further $51 billion in recovery aid.
Congress has now approved a total of more than $62 billion in hurricane assistance.
Mr Bush has declared 16 September a national day of prayer for the victims.
At a news conference in Washington last night, he outlined some of the immediate steps being taken to reduce the suffering of the hundreds of thousands of people affected.
Estimates of the death toll from Hurricane Katrina have run as high as 10,000 but the actual body count so far is much lower.
As of this morning, Mississippi had recorded 201 deaths and Louisiana 118, while other affected states had much lower numbers.
Five Irish still missing
According to the Department of Foreign Affairs, five Irish people are still missing in the wake of Katrina.
Staff from the consulate in Chicago are assisting Irish people in the region with documentation and trying to contact the missing people in question.
The department was notified by the families of the five missing people.
They are classified as long term residents of New Orleans, Louisiana and Biloxi, Mississippi, defined as such in so far as they are neither holidaying in the region or transient.
