And while world police body Interpol called for the fugitive Gaddafi's arrest for crimes against humanity, following a request by the International Criminal Court, there were reports a number of his generals had fled Libya.
The National Transitional Council has set a Saturday deadline for towns still loyal to Gaddafi to surrender, and on-off talks have been going on for days over Bani Walid, where a number of former regime officials, including Gaddafi's spokesman Mussa Ibrahim, are believed to be holed up.
"Sleeper cells of revolutionaries went into action and fighting has taken place between them and armed men loyal to Gaddafi on the streets of the town," Abdullah Kenshil, the NTC's chief negotiator, told journalists about 20 kilometres from Bani Walid.
Kenshil said the main forces of the NTC were still outside Bani Walid, about "one kilometre from the town." "We will not launch an attack without a decision by the NTC, but for now we have no choice and we want to protect our forces and the inhabitants of the town," he said.
One of the "revolutionary" fighters was killed and four wounded, while there were three deaths in the ranks of the pro-Kadhafi forces.
NTC commander Abdullah al-Khzami said earlier that "fierce fighting between our forces and pro-Gaddafi ones are underway in sectors very close" to Bani Walid.