Jubilant revolutionary forces have raised their flag over a convention centre in Sirte that served as a base for Muammar Gaddafi's loyalists, but fighting surged elsewhere in the town.
Col. Younis al-Abdally, a commander in Sirte, said his troops have surrounded pro-Gaddafi fighters in a small area.
He said the final battle is likely to be a fierce one, saying he has information one of Gaddafi's sons and a number of top officials from the former leader's regime are holed up in villas in Sirte.
He spoke as tank, rocket and machine-gun fire echoed through the streets around the Ouagadougou Convention Centre, an ornate complex that Gaddafi frequently used for international summit meetings.
The capture of the walled complex was a symbolic victory because Gaddafi fighters have used it as a base and stronghold throughout a weeks-long siege of the Mediterranean coastal city by forces of the new government.
Revolutionary forces also claimed significant gains in the inland enclave of Bani Walid, after weeks of faltering advances that resulted in part from the challenging terrain of desert hills and steep valleys. Bani Walid is believed to be harbouring high level figures from the Gaddafi regime.
Libya's de facto leader, Mustafa Abdul-Jalil, head of the governing National Transitional Council, said that he expected both cities to be seized within a week. Similar predictions in the past have not been fulfilled.
Heavy fighting raged in Sirte on as fighters pushed through residential areas that have been used as cover for the former regime's snipers.
The transitional leadership, eager to move forward with efforts to hold elections and establish a democracy more than six weeks after seizing control of the capital, has said it will declare that Libya has been liberated after Sirte falls.
A team from the International Committee of the Red Cross entered Sirte's Ibn Sina Hospital to evacuate wounded people left behind after three weeks of fighting.