Rebels have stormed a Tripoli neighbourhood, considered a stronghold of Muammar Gaddafi, amid heavy fighting with forces loyal to the Libyan leader who is currently on the run.
"Rebels have managed to enter the Abu Salim neighbourhood; clashes are taking place and rebels are pushing very hard," Al Jazeera's Zeina Khodr said, reporting from Tripoli on Thursday.
Hundreds of rebels were battling Gaddafi loyalists who have been defending Abu Salim with heavy firepower, she said.
Rebel fighters swept through houses and side streets to flush out snipers and were emerging with dozens of prisoners as gunfights were going on, the Reuters news agency reported.
Local residents, some with children, were in cars trying to get out of the neighbourhood, where support for Gaddafi has traditionally been strong, the report stated.
Residents have been told to stay inside for their own safety, Al Jazeera correspondents reported.
The fighting raged as rebels strived to eliminate the last pockets of resistance and find Gaddafi.
They have also offered amnesty and a reward to anyone who kills or captures the 69-year-old Libyan leader.
In Benghazi, the National Transitional Council (NTC) told a news conference on Wednesday that Libyan business people had contributed $1.7m for the cash reward.
Meanwhile, in an audio message broadcast on loyalist TV channels on Thursday, Gaddafi again called on his supporters to march on Tripoli and "purify" the capital of rebels, who he denounced as "rats, crusaders and unbelievers".
"Libya is for the Libyan people and not for the agents, not for imperialism, not for France, not for Sarkozy, not for Italy," he said. "Tripoli is for you, not for those who rely on NATO."
In an earlier audio address broadcast on Wednesday by the al-Rai television channel, he said Tripoli residents should repel the rebels' advance.
A rebel spokesman told Al Jazeera that "Libyan territory is 90 to 95 per cent under the control of the rebellion".
Meanwhile on Thursday, Al Jazeera found evidence of a possible mass execution of political activists in Libya.
James Bays reports from a Tripoli hospital. [Note: this report contains images that may offend sensitive viewers]
Visiting a hospital in Tripoli, our correspondent James Bays said he saw the bodies of 15 men suspected to have been killed a few days earlier as the rebels closed in on the Libyan capital.
"The smell here is overpowering," Bays said from the hospital where a number of bodies lay.
"I have counted the bodies of 15 men, we were told there were 17 here. Two bodies were taken away by relatives for burial."
"We are told these men were political activists who have been arrested over the last few days and weeks and being held near the Gaddafi compound. When the opposition fighters started to enter the compound we are told they were killed.
"Everyone I have spoken to who has looked at these injuries, all the medical staff, they say they believe that the injuries they see on the bodies of these men have the hallmark of a mass execution."
Bays said there were no forensic scientists at the hospital. Doctors there had taken photos of the exit and entry wounds on the bodies, with the intention of showing it to an expert at a later stage.
Fight for Sirte
Elsewhere in the country, rebel commanders said they are readying fresh attempts to advance against Gaddafi's forces in his hometown Sirte, 360km east of the capital and to break a siege of Zuwarah, a town to the west.
Jacky Rowland, Al Jazeera's correspondent in Ras Lanuf, 200km from Sirte, said rebels there were assembling heavy weaponry in anticipation of an assault on the Gaddafi stronghold of Sirte.
However, Scott Heidler, Al Jazeera's correspondent in the eastern city of Benghazi, said there had already been a stop to rebel advancement towards the Gaddafi stronghold. "So we are facing a battle in the coming hours."