Since the overthrow of the Ba'ath Party, Sistani has played an increasingly prominent role in regional religious and political affairs and he has been called the "most influential" figure in post-invasion Iraq.

Shortly after the U.S. invasion began, Sistani issued a fatwa advising Shia clergy to become engaged in politics in order to better guide the Iraqi people toward "clearer decisions," and to fight "media propaganda." As the summer of 2003 approached, Sistani and his followers began to petition the occupying forces for a constitutional convention. Later, Sistani called for a democratic vote of the people for the purpose of forming a transitional government. Observers described the move as being a path leading directly to Shia political dominance over Iraq's government, as Shia Muslims make up approximately 60% of the total Iraqi population. Subsequently, Sistani criticized American plans for an Iraqi government as not being democratic enough.

In early August, 2004, Sistani experienced serious health complications related to a previously diagnosed heart condition. He traveled to London to receive medical treatment. It was, reportedly, the first time that Sistani had left Iraq in decades, and may have been due, in part, to growing concerns for his safety from sectarian violence. Though still recovering, Sistani returned later in the month to broker a military truce at the Imam Ali Mosque in Najaf where Sheik Muqtada al-Sadr and the Mahdi Army had been cornered by American and Iraqi forces. Sadr, who rose rapidly to prominence through a series of independent military actions beginning in 2004, has since actively challenged Sistani's more progressive influence over Shia in the region.

Sistani's edicts reportedly provided many Iraqi Shia cause for participating in the January 2005 elections -- he urged, in a statement on October 1, 2004, that Iraqis recognize the election as an "important matter," additionally, Sistani asked that the elections be "free and fair. . . with the participation of all Iraqis." Soon after, Sistani issued a fatwa alerting Shia women that they were religiously obligated to participate in the election, even if their husbands had forbidden them from voting. In an issued statement Sistani remarked that, "truly, women who go forth to the polling centers on election day are like Zaynab, who went forth to Karbala."

He has consistently urged the Iraqi Shia not to respond in kind to attacks from Sunni Salafists, which have become common in Sunni dominated regions of Iraq like the area known as the "Triangle of Death," south of Baghdad. Even after the destruction of the Shia Al-Askari Mosque in Samarra in February 2006, his network of clerics and preachers continued to urge calm and told their followers that "it was not their Sunni neighbors who were killing them but foreign Wahhabis."

An alleged plot to assassinate Sistani was foiled on January 29, 2007, when three Jund al-Samaa gunmen were captured at a hotel near his office. It is believed to have been part of a larger attack against a number of targets in Najaf.

As the leading Ayatollah in Najaf, Sistani oversees sums amounting to millions of U.S. dollars. Sistani's followers offer him a fixed part of their earnings (tithe), which is used for educational and charitable purposes. Sistani's office has reported that it supports 35,000 students in Qom, 10,000 in Mashhad, and 4,000 in Isfahan. It also oversees a network of representatives (wakil) "who promote his (Sistani's) views in large and small ways in neighborhoods, mosques, bazaars, and seminaries from Kirkuk to Basra."

Additionally, Sistani has a substantial following within Shia communities all over the world and is the current Nayb-i Imam (Preeminent Marja) of the Twelver Sect of Shia Muslims. In Iran, as a result of the post invasion opening of the Iraqi cities of Najaf and Karbala to Iranians, many Iranians are said to return from pilgrimage in Iraq as supporters of Sistani.

In May 2007, hundreds of Shias demonstrated publicly in Basra and Najaf to protest comments made by television presenter and journalist Ahmed Mansour during a Qatari broadcast of Al Jazeera television programming. While presenting Bela Hodod (a.k.a. "Without Borders"), Mansour voiced skepticism of Sistani's leadership credentials while directing questions about the Iranian born cleric to his guest, Shia cleric Jawad al-Khalsi. Mansour also suggested that Sistani was not aware of contemporary problems in Iraq or of prevailing post - war conditions, and he alleged that Sistani's edicts were, largely, written and disseminated by aides. At another point, Mansour asked Khalsi whether the United States was using Iraqi politicians, and also Sistani, to promote western interests in Iraq.

Question: Is a mother allowed to abort the fetus, if she does not want it while the soul has not yet entered it and there is no serious danger to the mother's life?

Answer: She is not allowed to do that, except if the continuation of the pregnancy would harm her health or put her in an unbearable difficulty.

Like many of the Ahl al-Sunnah (Sunni) scholars, Shia marja do not condone abortions on the grounds of expected illness or deformity. Sistani shares this view:

Question: Sometimes the doctors reach the following conclusion: This fetus is afflicted with a very serious disease; it is therefore preferable that it should be aborted because if that child is born, it will be deformed or will die soon after birth. Is it, therefore, permissible for the doctor to abort the fetus? Is it permissible for the mother to agree to the abortion? And who of the two will become liable for indemnity?

Answer: Just the fact that the child will be deformed or that it will not live for a long time after his birth does not ever justify the termination of the pregnancy. Therefore, it is not permissible for the mother to consent to the abortion just as it is not permissible for the doctor to go ahead with the procedure. And whoever performs the abortion will become liable for the payment of indemnity.

Sistani also does not condone abortion after rape.

Sistani has publicly accepted the practice of adoption but maintains that the relationship gained by the adopter and the adoptee cannot become mahram:

Question: Are we allowed to adopt children and consider them as our own children?

Answer: It is permissible for a person to adopt a child, but the child is not considered his son or daughter; the child remains a stranger (non-mahram) to him or his wife and he or she does not inherit the person who has adopted him or her.