We present an imaging and spectral analysis of the nuclear region of the ULIRG merger Arp 220, using deep textit{Chandra}-ACIS observations summing up to (sim 300mbox{ ks}). Narrow-band imaging with sub-pixel resolution of the innermost nuclear region reveals two distinct Fe-K emitting sources, coincident with the infrared and radio nuclear clusters. These sources are separated by 1 ((sim 380) pc). The X-ray emission is extended and elongated in the eastern nucleus, like the disk emission observed in millimeter radio images, suggesting starburst dominance in this region. We estimate Fe-K equivalent width (gtrsim 1) keV for both sources, and observed 2-10 keV luminosities (sim 2times{10}^{40}mbox{ erg}mbox{ s}^{-1}) (W) and (sim 3 times {10}^{40}mbox{ erg}mbox{ s}^{-1}) (E). In the 6-7 keV band the emission from these regions is dominated by the 6.7 keV Fe textsc{xxv} line, suggesting contribution from collisionally ionized gas. The thermal energy content of this gas is consistent with kinetic energy injection in the interstellar medium by Type II SNe. However, nuclear winds from hidden AGN ((varvsim 2000 mbox{ km}mbox{ s}^{-1})) cannot be excluded. The (3sigma) upper limits on the neutral Fe-K(alpha) flux of the nuclear regions correspond to intrinsic AGN 2-10 keV luminosities (< 1times {10}^{42}mbox{ erg}mbox{ s}^{-1}) (W) and (< 0.4times {10}^{42}mbox{ erg}mbox{ s}^{-1}) (E). For typical AGN SEDs the bolometric luminosities are (< 3times {10}^{43}mbox{ erg}mbox{ s}^{-1}) (W) and (< 8times {10}^{43}mbox{ erg}mbox{ s}^{-1}) (E), and black hole masses (<1times{10}^5 M_{astrosun}) (W) and (< 5times{10}^5 M_{astrosun}) (E) for Eddington limited AGNs with a standard 10% efficiency.
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