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Next we'll find out what a bombing in Yemen tells us about al-Qaeda. The attack on the U.S. embassy killed 17 people and American officials say they believe it had the hallmarks of an al-Qaida operation. Diplomats and analysts say al-Qaeda in Yemen is reorganized after a series of setbacks. In the past couple of years, they say al-Qaeda has mounted increasingly deadly strikes, mostly against foreign targets. NPR's Ivan Watson reports from San'a.

IVAN WATSON: When militants launched their well-coordinated frontal assault on the U.S. embassy here, they killed at least nine Yemenis and one American citizen, 18-year-old Susan Elbanah,a high school student of Yemeni descent from Lackawanna, New York. Mohammed Elbaneh is Susan's older brother.

Mr. MOHAMMED ELBANEH (Susan's Brother): Susan, she was a - everyone knew she's real smart, quiet, fun-loving. She had a lot of friends. And when they hear that she passed away, they had a memorial for her at the high school.

WATSON: Mohammed says Susan traveled here for the first time this summer to marry a Yemeni man. On the morning of September 17, the newlyweds were standing in line for documents outside the U.S. embassy in San'a, when militants attacked the heavily fortified compound with bombs and automatic weapons. Tim Torlot, Britain's ambassador to Yemen, called the strike a huge escalation by al-Qaeda in Yemen.

Ambassador TIM TORLOT (Britain Ambassador, Yemen): We've known for some time that al-Qaeda here were focused on Western interests. It's the second attack on the American embassy this year and other attacks that we've seen have been focused on the interface between Western interests here, whether it's the oil companies, whether it's Western tourists or the diplomatic premises here.

WATSON: Al-Qaeda first attracted international attention in Yemen in 2000, in the sleepy port of Aden. This is where militants in a raft filled with explosives killed 17 American sailors when they rammed a navy destroyer, the USS Cole. In fact, Yemen's relationship with Islamist militants goes as far back as the 1980s, when thousands of Yemeni volunteers were recruited for a U.S.-backed program to fight the Soviets in Afghanistan.

Mr. ABDEL KARIM AL-ARIANI (Adviser, Yemeni President): I think Yemen is suffering from that policy.

WATSON: Abdel Karim Al-Ariani is an adviser to the Yemeni President.

Mr. AL-ARIANI: The first-generation terrorists, so to speak, were all in Afghanistan. Now we are facing the second-generation terrorists who were trained by the first generation

WATSON: After the September 11 attacks, Yemen signed on as an ally in the U.S.-led war on terror. Al-Ariani says the Yemeni government also embarked on a rehabilitation program for some of the jailed militants, which has been criticized by Washington.

Mr. AL-ARIANI: Some of them were rehabilitated, some of them were employed by the government, some were recruited into the army and security. Others, it seems, agreed not to act against the government for quite some time. Until recently, they resumed.

WATSON: Yemen is by far the poorest and most conflict-prone of the countries on the Arabian Peninsula. Gregory Johnson of Princeton University says in recent years the Yemeni government has had its hands full trying to deal with other, larger revolts that have nothing to do with al-Qaeda.

Mr. GREGORY JOHNSON (Ph.D. candidate, Near Eastern Studies, Princeton University): For the government, al-Qaeda has never been an existential threat that really threatened the survival of the regime.

WATSON: But Johnson says al-Qaeda got a shot in the arm in February of 2006, when 23 prisoners escaped from a jail in downtown San'a.

Mr. JOHNSON: And out of these 23, there were a number who had been very closely allied with Osama bin Laden in the late 1990s in Afghanistan, and they worked very hard and they've done a spectacular job over the last two years of really reorganizing, reconstituting al-Qaeda in Yemen, essentially bring the organization up from the ashes.

WATSON: One of the men who escaped in that jailbreak is Jaber Elbaneh, a Yemeni-American from Lackawanna, New York, who's on the FBI's most wanted list for allegedly providing material support to al-Qaeda. Elbaneh is a distant relative of Susan Elbaneh, the 18-year old who was killed with her husband during the attack outside the U.S embassy here. Susan's surviving brother Mohammed hopes that people will see past the stigma of his outlaw cousin and recognize that his family, too, has become a victim of the al-Qaeda movement

Mr. MOHAMMED ELBANEH: Family is accused of terrorism. The same thing, my sister was a victim of terrorism. Terrorists. Terrorist act.

WATSON: Ivan Watson, NPR News, San'a.

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