Rebels have seized several districts near the city of Bani Walid, held by pro-Gaddafi forces, said Col. Ahmed Bani, a military spokesman for the rebel Transitional National Council (TNC).
According to unofficial information from TNC sources, Muammar Gaddafi, the embattled Libyan leader whose whereabouts are still unknown, took refuge in Bani Walid. The city, located some 100 km (60 miles) southeast of Tripoli, remains one of the last bastions of forces loyal to Gaddafi.
"Revolutionaries among residents of Bani Walid have gained control of several districts in its outskirts and are currently exchanging fire with the dictator's forces," Bani said.
According to rebels, the city's defenders are led by Saif al-Islam Gaddafi, one of the embattled leader's sons. His second son, Mutassim, is also rumored to be in the area.
The TNC military command has earlier announced the rebel forces are poised to assault the besieged city, but will give time to Gaddafi supporters to surrender. The deadline is September 10.
The TNC, which has already been recognized by 60 countries as the only legitimate power in Libya, announced late on Sunday that another round of talks with tribal leaders has again failed.
"As chief negotiator, I have nothing to offer right now. From my side, negotiations are finished," Abdallah Kanshil, a negotiator for the interim council, was quoted as saying by Reuters.
"They said they don't want to talk, they are threatening everyone who moves," he added.
Western media initially said that talks between TNC envoys and Gaddafi loyalists ended in nothing. Later reports said that the dialog with tribal leaders of Bani Walid were underway on Sunday evening.
