"In the short term, we'll beat them, in the long term, we'll beat them," thundered Gaddafi, who slammed the West, calling the attack an "unjust aggression".
As Libya's capital Tripoli came under attack by coalition forces for a fourth night, Gaddafi(68), who has ruled the oil-rich north African nation for 41 years, said his fight will be an "historic battle" against them.
Libyan TV broadcast broadcast a live address by the Gaddafi shown standing on a balcony before supporters at his residential compound near Tripoli. It was Gaddafi's first public appearance in a week.
The state TV said the Libyan ruler was speaking from his Bab Al-Aziziya residential compound, where a three-storey building housing his command and control centre was flattened by a cruise missile on Sunday night.
Gaddafi's aggressive posturing came even as US President Barack Obama ruled out any changes in the "Operation Odyssey Dawn" for Libya till Gaddafi was in power or till the time he changed his approach towards his own people.
"As long as Gaddafi remains in power, unless he changes his approach and provides the Libyan people an opportunity to express themselves freely and there are significant reforms in the Libyan government, unless he is willing to step down, that there are still going to be potential threats towards the Libyan people," Obama said.
Gaddafi in his rambling speech told his supporters that their country was being attacked by "crazed Fascists".
As Libya was pounded from the air by the coalition, fighting between the rebels battling to overthrow Gaddafi and his forces has continued on the ground. In the east, rebels have progressed around 100 kms south of Benghazi to Ajdabiyah following Sunday's coalition assault on government tanks.
Vowing to crush a growing revolt which has seen eastern regions break free of his iron fisted rule, said, "I am not going to leave this land. I will die here as a martyr."
Clad in his trademark brown robes, Gaddafi seethed with anger and banged the podium refusing to bow to growing calls within the country and abroad to step down.
"I shall remain here defiant," said Gaddafi, dubbing anti-government protesters as "rats and mercenaries" who deserved the death penalty.
Gaddafi said he would call upon the people to "cleanse Libya house by house" unless protesters surrendered.
He also urged Libyans to take to the streets to show their loyalty. "All of you who love Muammar Gaddafi, go out on the streets, secure the streets, don''t be afraid of them ...Chase them, arrest them, hand them over," he said.