Sirte was rocked by deadly fighting on Friday in what Libya's new regime forces said was a final assault on Moamer Kadhafi's besieged hometown, with orders to take it despite stiff resistance.
Sustained mortar, machinegun and sniper fire was preventing National Transitional Council (NTC) forces from overrunning the Ouagadougou conference centre, a major bastion of pro-Kadhafi forces in the west of the city.
However, fighters said they had taken a 700-home complex west of the centre.
Defence Minister Jalal al-Digheily said the end of the conflict was near.
"We are very close to the end of the war and peace will be restored all over Libya," he told reporters in Tripoli on the occasion of visits by his British and Italian counterparts Liam Fox and Ignazio La Russa.
"There are still some hot spots but they won't resist very long," he added of Sirte and Bani Walid.
As ambulances streamed in to a field hospital near Sirte Friday amid heavy resistance, the Misrata military council said at least 12 fighters were killed and 193 wounded.
Hospital administrator Ahmed Mohammed Abu Oud said four ambulances were destroyed by fire from Kadhafi forces, and two ambulance workers wounded.
There were no immediate casualty figures from the eastern side of the Mediterranean city, 360 kilometres (225 miles) east of Tripoli.
After a ferocious dawn artillery and rocket barrage, hundreds of fighters tried to enter Sirte in pick-ups mounted with anti-aircraft and machineguns.
Much of the sustained NTC tank and mortar fire was concentrated around the Ouagadougou centre. The Misrata military council reported "snipers everywhere".
NTC commander Nasser Abu Zian told AFP that most of the ground troops had pulled back, with the centre constantly shelled by 106 mm cannon and anti-aircraft guns.
"The fighters went in three ways today," he said. "The Benghazi fighters went in from the east and we from the south and west."
"We are surrounding them in the centre of the city in an area of just a few square kilometres."
Plumes of black smoke could be seen billowing from several parts of the city amid the sound of machinegun fire and explosions.
NATO warplanes flew overhead, but there were no reports of air strikes.
NTC fighter Barak Abu Hajar told AFP he had been in action at the Ouagadougou centre and brought out a wounded comrade.
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"They're shooting from everywhere. RPGs and lots of bullets. We were told this was the final assault. Inshallah (God willing) we will take Sirte today."
Fighter Faisal Asker said: "We entered the Ouagadougou centre compound but fell back because of RPG (rocket-propelled grenade) and sniper fire. There's no cover there."
"We have orders to finish the mission today."
At the field hospital, just a couple of kilometres from the Ouagadougou complex, ambulances with wailing sirens arrived every couple of minutes.
Another AFP correspondent said there were particularly violent clashes around and inside the university, near the city centre, and in the Mauritanian Quarter.
Sirte and Bani Walid, a desert oasis 170 kilometres (100 miles) southeast of of Tripoli, are Kadhafi's last major bastions against the NTC, which has ruled most of the oil-rich country since the veteran strongman was toppled in August.
On Thursday night, the fugitive Kadhafi called "on the Libyan people, men and women, to go out into the squares and the streets and in all the cities in their millions" to reject the NTC.
"I say to them, do not fear anyone. You are the people, you belong to this land," he said in a scratchy audio message broadcast on Syria-based Arrai television.
However, a senior US defence official said Friday NATO commanders believe Kadhafi no longer commands forces loyal to him and his supporters are on the verge of defeat in Sirte.
"He (Kadhafi) effectively doesn't exercise command and control over militias loyal to him," the official said on condition of anonymity.
An NTC commander outside Bani Walid told AFP on Friday a new mediation attempt was under way, but if it failed a fresh assault would be launched there.
Omar Fifao said a delegation had been sent to negotiate with tribes in Bani Walid, some of whose number are fighting alongside Kadhafi forces, "to avoid a bloodbath."
"We have asked for a meeting so we can enter Bani Walid without fighting, but if no deal is reached we will have no option but to attack," Fifao said.
On Thursday, Mussa Ali Yunes, commander of the Jado Brigade, said efforts were being made to convince the remaining 10 percent of the population still there to leave before the new assault is launched after a month-long siege.
Yunes said Kadhafi son "Seif al-Islam is in Bani Walid and possibly Kadhafi as well, but there is a 50 percent doubt about that. There are many Kadhafi loyalists in Bani Walid, more than in Sirte."
Meanwhile, US Defence Secretary Leon Panetta called NATO's air campaign in Libya a "success story".
"At the time this mission was embarked on, there were a lot of critics (who questioned) ... whether it was the right mission at the right time, with the right force, whether NATO could do the job," he said in Italy.
"I think the critics have really been proven wrong," Panetta told allied troops at the air base in Sigonella, a key launch point for raids on Libya.
And the Middle East Economic Survey reported that Libya's oil output had risen to more than 350,000 barrels per day (bpd), after resuming on September 12.
Before the war, OPEC member Libya produced 1.6 million bpd of crude.