how to separate categories in loop.php?

Question

I am trying to get all the posts in a specific category separated into 3 different sections. Each category will be in a different div. When I try doing this, WordPress lists every post in every category in each div. How can I get it so that it will only list the posts in each category? I tried to modify loop.php so that my code would look like this

 //loop.php
 <?php  if ( is_archive() || is_search() ) :
 <div class="category">
      <p class="textYellow arrow"><a href="<?php the_permalink(); ?>" title="<?php printf( esc_attr__( 'Permalink to %s', 'paradiso' ), the_title_attribute( 'echo=0' ) ); ?>" rel="bookmark"><?php the_title(); ?></a></p>
 </div>
 endif;

The idea is that each category will sit in a div floated left so that each div will sit next to each other. So I would have three divs, three categories and each div would only list the posts title in that category.

for example,

div 1: 4 posts div 2: 3 posts div 3: 6 posts

Each div only showing the category posts related to that section.

Answer 1

Here is something i have used recently... not too complicated...
First.. we call all categories.
Then.. we get posts inside each category using foreach

<?php  
 $allcats = get_categories('child_of='.get_query_var('cat')); 

    foreach ($allcats as $cat) :
    $args = array(
    'posts_per_page' => 3, // max number of post per category

    'category__in' => array($cat->term_id)
    );

    $customInCatQuery = new WP_Query($args); 

    if ($customInCatQuery->have_posts()) : 
    echo '<div>';
    echo '<h3>'.$cat->name.'</h3>';
    echo '<ul>';    
    while ($customInCatQuery->have_posts()) : $customInCatQuery->the_post(); ?>

    <li><a href="<?php the_permalink(); ?>"><?php the_title(); ?></a></li>

<?php
endwhile; 
echo '</ul></div>'; 
?>

<?php else : 
echo 'No post published in:'.$cat->name;                
endif; 
wp_reset_query();
endforeach; 
?>

Hope this helps...
Have a gr8 day, Sagive.