Libyan leader Muammar Gaddafi has called on the Libyan people to arm themselves to liberate the country from NATO and those he called 'traitors'.

Colonel Gaddafi's audio message, broadcast on state television, was his first public address since rebel fighters launched their latest offensive on towns near the capital, Tripoli.

'The Libyan people will remain and the Fateh revolution (which brought Gaddafi to power in 1969) will remain. Move forward, challenge, pick up your weapons, go to the fight for liberating Libya inch by inch from the traitors and from NATO,' the Libyan leader said.

'Get ready for the fight ... The blood of martyrs is fuel for the battlefield,' he said, in what state television said was a live speech.

Over recent days, Libyan rebels have advanced into two strategic towns controlling access to Tripoli from the west and the south.

Fighting has been reported in both Zawiyah, 50km west of Tripoli, and Gharyan, which lies 80km to the south.

Tripoli is not under immediate threat from a rebel attack, but rebel forces are now in their strongest position since the uprising against 41 years of Gaddafi's rule began in February.

If both towns fall to the rebels, they would have Tripoli surrounded by land, blocking supply routes - with NATO blocking sea access.

Rebels today also fought forces loyal to Gaddafi loyalists around oil installations in the key eastern town of Brega while keeping a firm grip on a residential zone, an AFP reporter saw.

Brega's eastern residential zone three - rows of seaside apartment blocks that once housed the workforce of this strategic oil hub - was under total rebel control.

Many homes in the town however have been pillaged while streets are littered with ammunition shells and the carcasses of Gaddafi's military vehicles destroyed by NATO air strikes.

Rebels shuttled to and from the front line, which now lies in western Brega, near its oil installations, where they traded artillery fire with Gaddafi's troops.

Plumes of black smoke billowed across the sky as oil tankers burned after being set alight by loyalist forces, rebels said.

The coastline is booby-trapped with mines laid by Gaddafi's forces in a bid to deter attacks from the sea.

Libyan government spokesman Moussa Ibrahim blamed Western leaders and the media for the spread of rumours that the government was engaged in talks on the leader's departure from Libya.

'This information is absolutely incorrect and it is part of a media war against us. Their target is to confuse us, break our spirit, and shake our morale,' he said.

'The leader is here in Libya, fighting for the freedom of our nation. He will not leave Libya,' Mr Ibrahim said.

Interior minister lands in Cairo

Meanwhile, Libyan interior minister Mabruk Abdallah has flown in to Egypt on a private plane with nine members of his family, a Cairo airport security official has told AFP.

The flight arrived from the Tunisian island of Djerba, the source said, declining to be identified.

It was not immediately clear what the motives were for Mr Abdallah's unannounced trip to Egypt or if it marked a defection.

Talks continue in Tunisia

Meanwhile, UN secretary general Ban Ki-Moon's envoy for Libya flew into Tunis today, saying he would be joining talks between rebels and the Gaddafi’s government.

Former Jordanian prime minister Abdul Ilah al-Khatib said negotiations on Libya's future would be taking place in a hotel in the Tunis suburbs.

Libyan rebels joined members of the government the secret talks in the Tunisian town of Djerba, sources close to Tunisian security services said.

At the same time, a South African jet and two Qatari military helicopters were on the tarmac at the airport of Djerba, a south Tunisian island close to the border with Libya, an airport source told AFP.

‘Talks took place during last night at a Djerba hotel under heavy security,’ a source close to the Tunisian security services told AFP. ‘Corteges of cars on Sunday crossed the border at Ras Jedir, near Djerba’, the source added, asking not to be named.

Libyan health minister Ahmed Hijazi and social affairs minister Ibrahim Cherif stayed in Djerba yesterday, where they were joined by foreign minister Abdelati Obeidi, the national TAP news agency said.

Negotiations were under way with ‘several other foreign parties’, the agency added, without giving details of the content of the talks.