Celebration activities were held in the Libyan capital as government forces loyal to leader Muammar Gaddafi recaptured the eastern town of Ajdabiya on Tuesday.
At the same time, major powers in the world are still divided on a no-fly zone over Libya as government forces regained more control in the country.
Government forces' advance
According to Libya's state TV, government troops totally controlled Ajdabiya again after sweeping out rebel militants in the city.
Ajdabiya, which first came under attack by government forces on Monday, was set up as a stronghold against government forces by the rebels.
The town is only some 160 km away from Benghazi, the second largest city and base for the rebels.
According to Libyan state media, government paratroopers on Tuesday penetrated into Benghazi and exchanged fire with anti-government forces. But the reports did not elaborate on casualties of either side.
A statement broadcast on Libyan TV on Tuesday urged foreigners in the city to leave the country immediately, and called on local residents not to participate in rebel forces.
Libyan Deputy Foreign Minister Khaled Kaim told reporters that government forces are expected to recapture all the regions taken by anti-government troops, adding there were about 3,000 armed rebels left in Benghazi in desperation.
Libyan government forces have also reportedly retaken the small town of Zuwarah, 120 km west of Tripoli after heavy bombardment, according to Al-Jazeera TV.
Celebrations in capital
On Tuesday, celebrations were held in the Libyan capital from noon till midnight. Groups of young people marched through the streets, holding flags and banners, chanting slogans and shooting fireworks.
Libyan TV also broadcast footage showing demonstration of government supporters throughout the country.
Gaddafi on Tuesday evening received civilian representatives at his residence and made a speech.
"Those ideas that we will give up our land are wishful thinking," Gaddafi said, "they don't understand our history."
Gaddafi also slammed the stance of France, Britain and the Arab League to support the establishment of a no-fly zone.