Fighters for Libya's interim rulers entered Muammar Gaddafi's hometown of Sirte, braving heavy rocket and machine-gun fire in a "surprise" assault that one commander said would lead to the city's quick fall.
Meanwhile, as a plume of smoke rose over Tripoli, reportedly from an explosion at a naval base munitions dump, National Transitional Council chief Mustafa Abdel Jalil said a transitional government would be announced next week.
At a makeshift field hospital in a mosque west of Sirte, Dr Fatih Danini reported two NTC fighters were killed and 30 wounded in an apparent pincer movement also launched from the south and east.
Using tanks and pickup trucks mounted with anti-aircraft guns, the NTC forces cleared away roadblocks set up by Gaddafi forces and drove toward the city centre.
"We are pushing them back now" after a "surprise" order to attack issued by the NTC's top military brass, commander Mohammed al-Aswawi said in a radio truck monitoring all units on the front.
"First we get the families out, and then the order is to attack and free Sirte," he told AFP.
"There is also an advance from the south," he added, as the Misrata Military Council said the city's southern front was being reinforced by NTC fighters that took part in "the liberation of Al-Jafra."
Another commander said: "We're taking Sirte today. Our fighters are four to five kilometres into the city," from the roundabout that has been the front line for the past several days.
One NTC fighter, Bashir Salem, said "there are lots of snipers and they are firing lots of rocket-propelled grenades."
Fighter Ali Mohammed Wada, who was hit in the arm by shrapnel, reported a major firefight inside Sirte with Gaddafi 's forces, who were using RPGs and hand grenades.
"They tried to close the gates and we went deep inside the city," Wada told AFP.
"We also have people coming in from the coastal road. this is the furthest we have gone into the city so far."
He said the plan is to take the city centre and that "when the Gaddafi forces try to flee south we will get them there."
Heavy fighting also raged in Bani Walid, the only other remaining bastion of pro-Gaddafi diehards, as medics reported that a total of 30 NTC troops have been killed so far on that front.
A radio station loyal to the fallen Gaddafi regime called for a gathering at one of Bani Walid's squares, following a similar call for people to rise up for the "liberation" of the town by Gaddafi 's most prominent sons, Seif al-Islam.
On the political front, the NTC held talks on forming a new government amid doubts over whether disagreements that prevented a deal last week can be overcome.
Abdel Jalil, the head of the National Transitional Council, told a news conference that the makeup of Libya's interim government would be made public within a week.
"The composition of the transitional government will be announced next week," said Abdel Jalil, acknowledging that "differences in views" between members of the NTC and the executive office had delayed a deal.
The birth of a new government had been due last Sunday, but was postponed indefinitely because of haggling over portfolios.
One official insisted today's meeting would be "decisive," but another expressed doubts that differences could be overcome.
"There is still no agreement on the composition of the government or the number of its members," said the sceptical official.
"There are a lot of proposals," he said, and while there could be a deal, "I fear we will not reach one given the current situation."
After talks failed on Sunday, NTC number two Mahmud Jibril said much had been achieved and that he expected consultations to be "over quickly."
At the time, there were expectations that Jibril, a former Gaddafi official, would keep his post as interim premier, while Ali Tarhuni was touted to become vice president in charge of economic affairs.
The defence portfolio was expected to go to Osama al-Juwili and oil to Abdel Rahman bin Yezza.
The NTC is also expected to look into getting women and young people into major roles as deputy ministers and directors general of ministries.
On the ground, NATO said it was nearing the "final phase" of its air war in Libya, and said its only key hits on Friday were in the Sirte area -- a command and control centre, an ammunition dump, an anti-aircraft gun and armed vehicles.
While Libya's new authorities do not know where Kadhafi is, they are focused on taking Sirte and Bani Walid, two places where some think he might be.
But reports have also emerged that he may be in the south.
"General Belgasem al-Abaaj, who we captured on Monday, said that Kadhafi had contacted him by phone about 10 days ago, and that he was moving secretly between (the oases of) Sabha and Ghat," an NTC commander, Mohammed Barka Wardugu, told AFP.
Abaaj had said Gaddafi "is helped by Nigerian and Chadian mercenaries who know the desert routes," added Wardugu, spokesman for the Desert Shield Brigade.
Gaddafi's daughter Aisha said her father was well and fighting on the ground.
"Remain reassured, your great leader is doing well. He carries weapons and is fighting on the fronts," she said in a telephone message aired by Syria-based Arrai television, which regularly broadcasts comments from Kadhafi or his family.
"You can be proud of your leader," she said, addressing the "resistant people" of Libya.
Aisha Gaddafi, who fled to Algeria with her mother and two brothers late last month, called on the people to "rise" against the new rulers, saying NTC members were "traitors who have broken their oath of allegiance" to Kadhafi.