The chief of Libya's revolutionary movement has told thousands of cheering Libyans in Tripoli to strive for a civil, democratic state, while loyalists of the hunted dictator Muammar Gadafy killed at least 15 opposition fighters in an attack on a key oil town in Libya's east.
From hiding, Col Gadafy urged his remaining followers to keep up the fight, a sign that Libya's six-month civil is not over even though revolutionary forces now control most of the country and have begun setting up a new government in the capital.
Meanwhile, hundreds of Libyans fled a desert town held by Muammar Gadafy's forces today, complaining of hardship and intimidation, as fighters backed by the country's new rulers warned of a full onslaught in the coming days.
Forces of the new ruling National Transitional Council (NTC) that overran Tripoli on August 23 have met unexpectedly stout resistance in five days of fighting for the town of Bani Walid 180 km southeast of the capital.
Along with Gadafy's hometown Sirte on the central Mediterranean coast and Sabha in the remote southern desert, Bani Walid counts among the last strongholds of old regime fighters and their resistance has impeded NTC efforts to normalise life in the oil-rich North African state.
Residents fleeing the town have reported days of intense firefights, and Nato warplanes were backing up NTC fighters with air strikes on pro-Gadafy rocket positions.
Families trapped there for weeks started to slip out after Gadafy forces abandoned some checkpoints on the outskirts, and scores of cars packed with civilians streamed out of the area today and yesterday.
Mustafa Abdul-Jalil, head of the NTC, last night addressed a rowdy crowd of thousands in Martyr's Square in central Tripoli, a site that until recently was famous for pro-Gadafy rallies. Flanked by a few dozen revolutionary leaders in their largest public gathering since rebel forces stormed into the capital on August 21st, he called on Libyans to build a state based on the rule of law.
"No retribution, no taking matters into your own hands and no oppression. I hope that the revolution will not stumble because of any of these things," he said.
As he spoke, thousands waved flags, cheered and chanted, "Hold your head high, you're a free Libyan!" Some wept openly as fireworks exploded overhead.
Mr Abdul-Jalil, who served as Col Gadafy's justice minister before joining the rebels at the uprising's start, defined the government he says the NTC hopes to create.
"We strive for a state of the law, for a state of prosperity, for a state that will have Islamic sharia law the basis of legislation," he said.
He also thanked Nato, the United States and a number of Arab and European countries for their aid to the rebels during the war. Nato bombed Col Gadafy's military under a UN mandate to protect civilians, giving rebel forces an edge on Col Gadafy's better armed and trained soldiers.
Mr Abdul-Jalil said the new Libya would focus on youth and women, adding that some ministries and embassies would be headed by women. Some have criticised the rebel movement for not putting women in leadership roles, and none stood on stage with the movement's leaders.
This didn't bother some in the crowd. "God willing, all he said will come true," said Sabriya Mohammed (50) who came to the rally with her two adult daughters. "He mentioned women specifically and said we'd have our place. He's a man who knows the importance of the law."
Libya's new leaders face the huge challenge of building a new government in a country with no recent history of democracy or independent civil institutions. They also have yet to extend their control over all of Libya.
From hiding, Col Gadafy called on his remaining followers to keep fighting. "We will not be ruled after we were the masters," said the brief statement attributed to Col Gadafy that was read on Syria's Al-Rai TV by its owner Mishan al-Jabouri, a former Iraqi lawmaker and Gadafy supporter.
The message described Libya's new leaders as "traitors" who are willing to turn over the country's oil riches to foreign interests. "We will not hand Libya to colonialism, once again, as the traitors want," said the statement, which pledged to fight against the "coup."
Col Gadafy's whereabouts are unknown, but his followers claim he is still in Libya. Some of his family members have fled to neighbouring Algeria and others to Niger, most recently his son Saadi.
Showing that his loyalists still pose a threat to opposition control, suspected loyalists staged deadly attacks on the Ras Lanouf oil terminal in Libya's east that began with saboteurs setting fires and then shifted to a convoy of gunmen riding in from the desert.
Col Hamid al-Hasi, the commander for anti-Gadafy forces in eastern Libya, said a group of 15 employees set fire to the facility, located on the Mediterranean coast about 615km southeast of Tripoli.
In a possibly coordinated attack, the port was then targeted by a convoy of armed men apparently based in a refugee camp about 30km south of Ras Lanouf.
The supervisor of the Ras Lanouf hospital, Dr Ahmad El-Gnashi, said 15 guards were killed and two injured.
Revolutionary forces are still struggling to seize control of at least three other towns.
Opposition pickup trucks mounted with machine guns converged outside the loyalist-held town of Bani Walid for a possible intensified assault after several failed attempts to drive out pro-Gadafy forces. One opposition commander claimed Col Gadafy's son Seif al-Islam is leading loyalist forces massed in the town, about 140km southeast of Tripoli.
It is unlikely that pro-Gadafy fighters can withstand a sustained siege on the town. But it's unclear whether the showdowns in the last loyalist strongholds - including Col Gadafy's hometown of Sirte - will mark a crippling end or open a new phase of an underground insurgency and hit-and-run attacks against Libya's new leadership.
Dozens of cars loaded with Libyan families and personal belongings streamed out of the town in anticipation of a fresh assault.
Khairiyah al-Mahdi, a 40-year-old housewife, was fleeing the town along with her husband, six daughters and two sons.
She said her house was among the first to fly the revolution's tricolour flag when Libyan fighters pushed into Bani Walid over the weekend. But deteriorating living conditions, threats from Gadafy supporters and heavy clashes in the town prompted her family to flee.
"We left Bani Walid because Gadafy loyalists in control of the local radio announced through airwaves that anyone helping the rebels or part of them will be killed," she said. "A lot of people are scared and now leaving."
Nato, which has played a key role in crippling Col Gadafy's military forces since intervening in Libya's civil war in late March, has kept up its attacks on remaining pro-Gadafy sites. The military alliance said its warplanes hit targets Sunday in Col Gadafy's hometown of Sirte, including a military logistics facility and three surface-to-air missile systems.
The Misrata Military Council said clashes inside Sirte between loyalists and opposition backers has left at least three people dead.
Meanwhile, Canada has obtained UN approval to unfreeze $2.2 billion in Libyan assets for humanitarian aid and is ready to reopen its embassy in Tripoli, Foreign Minister John Baird said on today.
The released money will be used to rebuild infrastructure and to pay wages of police, teachers and other essential services following Libya's six-month uprising, Mr Baird told reporters.
"While security still remains a challenge on the ground, life is slowly returning to normal in Tripoli," Mr Baird said.
After sending a team to assess the situation in Tripoli, the government decided to begin work on reopening its embassy at a temporary location, he added. Officials have started refurbishing the embassy and putting security in place.
Ottawa is hoping the move will help Canadian businesses partake in some of the lucrative contracts expected in the country as it rebuilds.
Mr Baird did not say how soon he expected the embassy to be operational. U.S. officials said on Monday they expected the US embassy to be up and running within weeks.