* Visit comes a day after court confirms mass death sentence
* U.S. official says Egypt courts respond to govt agenda
* Kerry to stress threat from Iraq conflict (Recasts with Kerry/Sisi meeting, statement by foreign ministry)
By Lesley Wroughton
CAIRO, June 22 (Reuters) - U.S. Secretary of State John Kerry held talks on Sunday with President Abdel Fattah al-Sisi in Cairo over concerns about Egypt's crackdown on the Muslim Brotherhood and the threat which the conflict in Iraq poses to the Middle East.
Kerry is the highest-ranking U.S. official to visit Egypt since Sisi, the former military leader who toppled Islamist President Mohamed Mursi after mass protests last year, won a presidential election in May.
His visit comes a day after an Egyptian court confirmed death sentences against 183 members of Mursi's Muslim Brotherhood, including its leader Mohamed Badie, in a mass trial on charges of violence in which one policeman was killed.
The Obama administration has said it looks forward to working with Sisi's government but expressed concerns over widespread human rights abuses and limits on freedom of expression.
"This is a critical moment of transition in Egypt (and) enormous challenges," Kerry said before an earlier meeting with Egypt's new foreign minister Sameh Shukri. "There are issues of concern ... but we know how to work at these."
Shukri told his American counterpart that the relationship between the U.S. and Egypt should be based on "mutual respect and joined interests and with no interference in internal affairs," according to a statement by the Foreign Ministry.
A senior State Department official said Washington was worried about the use of heavy-handed political and security tactics by Egypt's authorities, which he said was polarizing Egyptian society.
"They in some ways are radicalizing certain aspects of Egyptian society in ways that are not supportive of overall stability in Egypt," said the official, who briefed reporters en route to Cairo.
Still, the official said there had been "a few flickering signs of positive movement" in recent weeks. Among these was the release of an Al Jazeera journalist, steps to start addressing sexual violence against women and Sisi's call during his first cabinet meeting for the revision of the human rights law.
The United States, which has counted on Egypt as a close Middle East ally for decades following its 1979 peace treaty with U.S. ally Israel, froze some of its $1.3 billion in annual military aid to Egypt following Mursi's overthrow.
About $575 million in suspended funds have been released over the past 10 days and will be used to pay existing defence contracts, the State Department official said. Washington has also said it will provide 10 Apache attack helicopters to help soldiers battling militants in the Sinai peninsula.
The Obama administration has made clear that the remaining funds, which require Congressional approval, will be released once there is evidence Sisi's government is taking further steps towards democracy, the senior State Department official said.
During his meetings, Kerry will press Egypt's new leadership to release imprisoned journalists and raise concerns about the mass trials and death sentences of Muslim Brotherhood supporters, the official said.
"Those trials are a serious issue of due process concern for us and for others in the international community," the official said. "The judiciary is responding to a political environment that the government has created."
The official said the United States did not believe that the Muslim Brotherhood posed a security threat to Egypt and had seen no information that substantiated a link to terrorist groups.
The official said the United States had asked Egypt to share the evidence "but at present we do not have that information."
"We believe that in a general sense the Egyptian government needs to have a politically inclusive approach, which means that they need to include, and find ways to reach out to, the Muslim Brotherhood," the official said.
Kerry's visit is part of a broader tour of the Middle East and Europe. Obama said on Friday he would dispatch Kerry to the region for talks on the conflict in Iraq.
The Islamic State in Iraq and the Levant (ISIL), an al Qaeda offshoot, has seized swathes of territory in northwest and central Iraq including the city of Mosul. It has taken large amounts of weaponry from fleeing Iraqi troops and looted banks.
The senior administration official said Kerry would underscore the severity of the threat posed by Sunni militants to Iraq, the region, and the United States, and the need for Iraqi leaders to form a government not divided along sectarian lines. (Additional reporting by Yasmine Saleh. Editing by Mark Trevelyan)
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