|Opposition fighters say the assault has subsided, but they expect fresh attacks later on Saturday evening [Reuters]
Reports from Libya say pro-government forces have entered the western outskirts of the opposition stronghold of Benghazi, with the city also coming under attack from the coast and the south.
French fighter jets, meanwhile, were conducting reconnaissance overflights of "all Libyan territory" on Saturday, French military sources said.
Witnesses in Bengazi, in the east of the country, said they heard large explosions on Saturday. Al Jazeera's correspondents reporting from the city reported multiple explosions, plumes of smoke in the sky and a fighter jet belonging to the opposition getting shot down.
Government troops reportedly bombed the southern Benghazi suburb of Goreshi among other places. Artillery and mortars were also fired in the centre of the city.
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Mustafa Abdel Jalil, head of the opposition National Libyan Council, told Al Jazeera "there is a bombardment by artillery and rockets on all districts of Benghazi".
Urging swift action in Libya, he said: "We appeal to the international community, to all the free world, to stop this tyranny from exterminating civilians."
Al Jazeera's Tony Birtley, reporting from Benghazi, said: There's a lot of jittery people here at the moment, there is a lot of activity and a lot of firing going on."
French Rafale fighter jets, meanwhile, were reported to be conducting flights over Libyan airspace on reconnaissance missions as fighting was continuing in Benghazi and other areas.
The Libyan government firmly denied it attacked the city. "There are no attacks whatesover on Benghazi. As we said, we are observing the ceasefire," Musa Ibrahim, a government spokesman, told the Reuters news agency.
Khaled Kaim, Libya's deputy foreign minister, told the BBC "the ceasefire is real, credible and solid. We are willing to receive [international] observers as soon as possible".
He also insisted the government had grounded its air force.
On Saturday, Moussa Khoussa, the foreign minister, requested Ban Ki-moon, the United Nations chief, to send observers to monitor the "ceasefire", saying that his country has "fulfilled all of its obligations to the international community".
But Ibrahim Jibreel, a Libyan political activist, told Al Jazeera "we need to first consider the source" when receiving information about Libya. He said the government has "demonstrated their ability and willingness to lie time and time again".
Besides Benghazi, fresh fighting was reported on Saturday in the nearby rebel-held town of Ajdabiya. Fierce battles raged in Misurata, a town close to the capital Tripoli, where pro-Gaddafi forces were gathered at the outskirts.
Misurata was left stranded in the west while rebels who had advanced from the east were beaten back by a counteroffensive by loyalist forces.
There were also reports of government forces attacking the town of Az Zintan.
Meanwhile, Abdel Fatah Younis, the former interior minister who left Gaddafi's government to join the opposition, has denied reports on Libyan state television that he has rejoined the government.
Al Jazeera's James Bays, also reporting from Benghazi, said "[the opposition has] the resolve, they are determined to fight back, but they don't have the hardware that Gaddafi's forces have".
He said "it will likely be a protracted battle" if Gaddafi tried to take the opposition stronghold.
Bays warned that with Gaddafi's forces almost inside densely-populated Benghazi, international military strikes against them would become "much more difficult".
"The time for [international] action was some hours ago, it's going to be much more difficult now," he said.
Later, Ibrahim, the government spokesperson, announced that Muammar Gaddafi, the Libyan leader, had sent urgent messages to the French and British leaders, telling them they "will regret" interfering in the country's affairs.
In another letter, addressed to Barack Obama, the US president, Gaddafi blamed Libya's violence on al-Qaeda, asking: "What would you do if you found them controlling American cities with the power of weapons? What would you do, so I can follow your example?"
But our correspondent said there was no al-Qaeda presence in Benghazi and other opposition towns
"[Ordinary] men women and children in the towns and cities of eastern Libya are the ones fighting," Bays said.
Obama delivered an ultimatum to Gaddafi on Friday, threatening military action if the Libyan leader ignored non-negotiable UN demands for a ceasefire.
The warning came shortly after the UN Security Council authorised a no-fly zone over the north African country.
Within hours of Obama's ultimatum, Susan Rice, the US ambassador to the UN, asked by CNN whether Gaddafi was in violation of these terms, said: "Yes, he is."
Libya's government announced on Friday an "immediate ceasefire" against pro-democracy protesters.
Military action 'imminent'
Following the no-fly-zone vote at the UN, Gerard Araud, the French ambassador to the UN, said Western military intervention in Libya was imminent.
France hosted a "decisive" summit on Saturday with the European Union, Arab League and African Union, as well as UN chief Ban Ki-moon, on taking UN-sanctioned military action in Libya.
Following the summit, Nicolas Sarkozy, the French president, said leaders had decided to "ensure the resolution" was enforced and that fighting stops. He said that French and other countries' warplanes would enforce a no-fly zone, and would also target "tanks who would threaten civilians".
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Obama, in his remarks, made clear any military action would aim to change conditions across Libya - rather than just in the rebel-held east - by calling on Gaddafi''s forces to pull back from the western cities of Az Zawiyah and Misurata as well as from the east.
"Gaddafi must stop his troops from advancing on Benghazi, pull them back from Ajdabiya, Misurata and Az Zawiyah, and establish water, electricity and gas supplies to all areas.
"Humanitarian assistance must be allowed to reach the people of Libya.
"Let me be clear, these terms are not negotiable ... If Gaddafi does not comply ... the resolution will be enforced through military action."
The reports of government forces trying to storm Benghazi on Saturday followed a night of rumours that Gaddafi's troops were within striking distance of the city.
Hundreds of men, some riding in pick-up trucks mounted with machine guns, had flooded out of the city in response to a call from Benghazi's rebel-run radio to swiftly man their posts.
Several loud explosions, some of them followed by anti-aircraft fire, were heard inside Benghazi and new checkpoints sprang up as word spread that Gaddafi's forces could be on their way.