Protesters gather in Tripoli, to denounce the recent NATO air strike in Majar August 12, 2011.[Photo/Agencies]

Rebel fighters pushed government troops back about 7 km from their previous positions, fixing a front line about 5 km north of the village of Bir Shuaib, near a diaper factory. They set up a checkpoint on the road and about 150 fighters gathered, some firing weapons in the air to celebrate their advance.

Rebels said it had been a heavy battle, with pro-Gadhafi forces using anti-tank guns. A medic said three rebel fighters were wounded in the battle but none were killed. Government troops withdrew after six hours of fighting, the rebels said.

"God willing, we will be attacking Zawiyah in one or two days," said local rebel commander Mokhtar Lakdar.

Judging by impact craters, wrecked buildings and burnt-out tanks, NATO warplanes have bombed government military targets on the route of the rebel advance over the past week, providing close air support.

Zawiyah is the home town of many of the rebels battling on the western front. It has staged two uprisings against Gadhafi since March but remains in government hands along with its refinery and harbour on the Mediterranean coast.

Rebels hope to capture Zawiyah and cut off Gadhafi's stronghold, the capital Tripoli, from access to the outside world along the coast road.

Gadhafi's Deputy Foreign Minister Khaled Kaim on Friday said the rebels could not take Zawiyah and the western coastal highway. "In their dreams," he said. A captured Libyan intelligence officer told Reuters the army had reinforced its garrison in the town and was ready for a fight.