ULOOJ.

Actually, the Arabic word in question is more accurately transliterated ‘ulûj, but the form in the title gives an idea of the pronunciation, and is the one used in the article (by Hannah Allam) I’m linking:

College students whisper the word when they spot U.S. troops in Baghdad streets. Vandals scrawl the word across military vehicles. Sneering taxi drivers mutter it when convoys block their cabs.
“Ulooj,” they say, and while some use it with disdain and others more lightheartedly, it’s unmistakably not a nice reference—though what precisely the ancient term from Arabic literature means depends on whom you ask. Among the translations offered: pigs of the desert, foreign infidels, little donkeys, medieval crusaders, bloodsuckers and horned creatures.

While no one can quite pin down the original definition, Iraqis agree on the modern definition: “It’s the American military,” said Maria Hassan, a 23-year-old history major at a university in Baghdad. “We use this word from the past for our occupiers of the present.”
The revival of “ulooj” (pronounced oo-LOOZH) is the handiwork of Mohammed Saeed al Sahaf, the alternately comical and caustic information minister from the former Iraqi regime.
In the first days of the war, Sahaf sent Iraqis running for their dictionaries when he used the word in a speech to describe advancing U.S. forces. Today, “ulooj” lingers as the unofficial national nickname for American soldiers, even among many who profess support for the U.S. presence.
“The Americans always use fancy words for their operations here—Desert Storm, Iron Grip—so we should also have special names for them,” said Ahmed Kandeel, a 20-year-old Egyptian who attends university in Iraq. “What does ‘ulooj’ mean, anyway? Isn’t it ‘pigs of the desert?’ ”
Ali al Khateeb, who translated Sahaf’s live remarks into English for foreign journalists during the war, said he was stumped the day his former boss mentioned “ulooj” at a news conference. Khateeb said he racked his brain for a suitable translation as Western reporters stared at him with impatience. He finally settled on “the enemy” for lack of a better definition.
“I went to my old professors after that press conference to ask them for a more precise word,” said Khateeb, who’s now a producer for an Arabic-language satellite TV station. “One told me it means ‘little donkeys’ and the other said it’s ‘big monsters with small minds.’ No one can say for sure. It was an obsolete word before the war.”…
Salah al Qureishi, a linguistics professor at al Mustansiriya University in Baghdad, said he consulted four dictionaries when he first noticed his young students casually using a word he last recalled seeing in yellowed texts describing the conquests of a seventh-century Islamic ruler.
“I was astonished,” Qureishi said. “I thought, ‘Where on earth did they get this word?’ ”
Qureishi said the information minister unearthed “ulooj” because he “wanted to find words not used by common people so he would stand out as superior and intellectual.” He said “ulooj” also was a good example of how Saddam Hussein, the ousted dictator with notoriously flowery speeches, enjoyed invoking Islam’s golden age to remind his countrymen of Iraq’s glorious past. The only problem was, most Iraqis weren’t quite sure what their former leaders were talking about.

This is a funny story that I’m happy to pass along, but I have a couple of comments. First, the word doesn’t seem that obscure; I pulled down my tattered paperback Arabic-English Dictionary of the Modern Literary Language by Maan Z. Madina and found a nice full entry on the root ‘ayn-lam-jim, beginning with the noun ‘ilj (plural ‘uluj) ‘unbeliever; uncouth person, roughneck.’ I’m willing to believe that it’s not in common use, but I think Salah al Qureishi may be exaggerating just a wee bit. I mean, there are words you have to look up in Lane’s eight-volume Arabic-English Lexicon; Madina is comparable to a collegiate dictionary.
Second, this story is so good they recycle it every few months. Here‘s an example from last April, with slightly more detail:

Scholars produced by Asharq al-Awsat apparently traced “al-Uluj” back to ancient Islamic history, and specifically, to the Abbasid era, when Muslims used it to refer to prisoners of war captured in battles with non-Arabs.
These prisoners reportedly had “red skin” and were “tall” and heavily built. In the long run, however, this definition was reduced to just one word, according to Asharq al-Awasat: “Infidel”.

At any rate, if I overhear an Iraqi referring to me as an ‘ilj, I will be amused rather than insulted.
(Via mirabilis.ca.)