Opposition leader Benazir Bhutto on Tuesday urged President Gen. Pervez Musharraf to resign and ruled out serving under him in a future government after she was placed under house arrest for the second time in five days. "Musharraf himself is a hurdle in the way of democracy," she told private Geo TV network in a phone interview from the house in Lahore where she was being held to prevent her staging a protest procession. "In order to save Pakistan, Musharraf should resign." Asked whether she would serve under Musharraf in a future government, she said "No." Her comments appeared to bury hopes of the political rivals forming a pro-US alliance against rising Islamic extremism. They had held months of talks that paved the way for Bhutto's return from exile last month to contest January parliamentary elections. Bhutto accused Musharraf of imposing martial law when he declared emergency rule on Nov. 3 - suspending citizens' rights and rounding up thousands of his opponents. "I will prefer to live in jails here rather than being taken abroad," Bhutto said when asked about reports that she might be deported. "I will not leave my people even if I am arrested." She demanded that Musharraf resign both as president and army chief and that an "interim government of national consensus" be set up to supervise the elections. "Musharraf should leave both the offices," she said. Bhutto said her party had contacted other opposition groups, including the party of cricketer-turned politician Imran Khan, for setting up a "coalition of interests" against Musharraf. Pakistan authorities have mounted a massive security operation to prevent Bhutto from leading a procession from Lahore to the capital, Islamabad, intended to press the military ruler to lift the emergency he says is needed to fight rising Islamic militancy. Thousands of riot police blocked all roads leading to an upscale neighborhood where Bhutto was staying and police said more than 100 of her supporters had been arrested in the area Tuesday.