Hundreds of Libyan families and foreign workers fled on Sunday from Bani Walid, one of the final bastions of Moamer Kadhafi's regime, a day after clashes killed at least 26 people.
An AFP photographer saw dozens of cars crammed full with families pouring out of Bani Walid, a hilltop town of around 100,000 inhabitants located 185 kilometres (115 miles) southeast of Tripoli.
Dozens of foreign workers, many of them Egyptian citizens, fled on foot in the direction of Tripoli and military vehicles shuttled back and forth to give them a lift.
Clashes on Saturday between pro-government forces and fighters described by authorities as criminals and loyalists of Kadhafi's ousted regime killed at least 26 people and wounded more than 200, according to an AFP tally.
On Sunday the crackle of gunfire and sporadic blasts could be heard just three kilometres from the main entrance of the town, testifying to the intensity of ongoing combats, the AFP photographer said.
Colonel Salah al-Borki, who heads a brigade of former rebels on the western front, told AFP that his forces were advancing on the town and had seized the checkpoint leading to it.
"We are dealing with some pockets of resistance, particularly snipers posted on rooftops," he said, adding that two of his men had been wounded.
"We are trying to create safe corridors to allow civilians to leave the city so we can have more room to manoeuvre," said Borki, adding that his troops "have so far only used light weapons to spare the lives of civilians."
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Saturday's fierce clashes, the latest in a series of violence in Bani Wali,d marked exactly one year since Kadhafi was captured and killed on October 20, 2011.
A dozen of people were killed in shelling and clashes in previous days, sources in both camps said.
National Assembly president Mohammed Megaryef, who has warned that not all of Libya had been successfully liberated, has described Bani Walid as a "sanctuary" of outlaws and diehard former regime loyalists.
"The campaign to liberate the country has not been fully completed... Bani Walid's misfortune is that it has become a sanctuary for a large number of outlaws and anti-revolutionaries and mercenaries," he said.
Many Libyans are persuaded that heavy weight figures of the previous regime, including Kadhafi's son Khamis, took shelter in Bani Walid after the end of the 2011 conflict.
Social networking sites were abuzz Sunday with "rumours" of their capture.
And the new Libyan authorities on Saturday sparked confusion by relaying rumours and issuing conflicting statements on the arrest of Khamis and Kadhafi's spokesman Mussa Ibrahim.
The threat of a full out assault has weighed down on Bani Walid for weeks following the death of a former rebel, a native of the rival city of Misrata, who was kidnapped and allegedly tortured in the oasis town.
Misrata and Bani Walid fought on opposite sides of the 2011 conflict but the hostility between the neighbouring cities runs further back.