|Taylor (right) is under renewed|
A Liberian government official, contacted by phone, denied reports that the rebels were within five kilometres of the city centre, but confirmed that fighting was underway.
An aid worker who fled her home in the suburb of Brewerville said her children had seen the rebels, from the Liberians United for Reconciliation and Democracy (LURD) in Banjor, a western suburb.
There was fighting very close to the town of Duala, she said, adding that the rebels were seeking to cross the St. Paul Bridge which connects the city centre to the western suburbs.
Another eyewitness said Duala, some four kilometres from central Monrovia, was flooded with displaced people fleeing the region of Brewerville, where there are several refugee camps.
The reports of fighting came as Taylor, who briefly went to Ghana on Wednesday for peace talks with the LURD rebels, announced that an abortive coup attempt had been made against his regime.
In the Ivory Coast city of Abidjan, meanwhile, a regional official of the UN's World Food Programme (WFP) also reported unrest in the Monrovia region.
West African spokesman for the WFP Ramin Rafirasme said refugees from a camp at Vicks outside the capital in particular were fleeing into town where the situation was very tense.
The WFP official said some 17,000 refugees had been housed in the camp at Vicks, which is 10 km from Monrovia.
The official warned that if a peaceful solution was not found fast, the humanitarian situation, which was already very bad, could become catastrophic.
LURD, one of several groups fighting Taylor's forces, controls a large part of the west African country, where endemic civil war has left an estimated 200,000 people dead since the 1980s.
Taylor is a former rebel who started a brutal civil war in Liberia in the 1990s to end years of dictatorship. He won elections in 1997 but his former enemies launched a revolt in 2000.
It was Taylor's links with rebels in Sierra Leone's civil war in the 1990s that caught up with him on Wednesday. A United Nations-backed court indicted him for alleged war crimes during the war, in which he supplied weapons in return for diamonds.