But in the other main redoubt of Bani Walid, Muammar Gaddafi's forces went on the offensive after the fugitive ex-strongman broadcast a message rallying resistance to a weeks-long siege by National Transitional Council forces.
Meanwhile, a member of the NTC said formation of a transitional government, already delayed by squabbling over power-sharing, has been postponed until the entire country is liberated.
Hundreds of fearful civilians have fled Sirte, a sprawling Mediterranean city 360 kilometres (225 miles) east of Tripoli, as the new regime's forces close in from east, south and west.
NTC fighter Fateh Marimri, who drove out of Sirte's eastern gate in what he said was a captured Gaddafi 4X4, said clashes were ongoing around the Mahari Hotel.
"There is intense fighting between us and them. They are using heavy weapons but we are not as we want to cause minimum damage to civilians," Marimri said.
"They are now fighting us in civilian clothes and there are African mercenaries everywhere in Sirte," he told AFP.
Without giving names, he claimed Gaddafi's family members were inside Sirte, backed by a "large number of his forces."
Gaddafi diehards have been putting up a fierce resistance, and there is the danger of intense street fighting hanging over the remaining residents.
"As we move closer to the city centre, it's going to be face-to-face street fighting and we are preparing for it," said another fighter, Ali Zaidi.
Commander Mustafa bin Dardef of the NTC's Zintan Brigade said "there were clashes in the night and we now are controlling the port."
Dr Yusuf al-Badri said the overnight clashes were the fiercest so far in the battle for the city.
"Today's level of casualties was intense. We had some 40 fighters being treated of whom two died," he said, adding the average number of casualties in recent days had been about 20.
The port and university lie on the northeastern side of Sirte but it is in the centre that Gaddafi's compound and military bunkers lie and NTC fighters said they expected the fiercest resistance.
Fleeing residents spoke of dwindling supplies of food and water and said Gaddafi forces were trying to prevent people from leaving.
"There's no food, no electricity; we were eating just bread," said Saraj Al-Tuweish, who got out with his extended family of some 60 people on Tuesday.
"I've been trying for 10 days to get out and every time the army forced us back," Tuweish told AFP.
"We would go the checkpoint and they would refuse, they would shoot in the air. Today we used a dirt road early in the morning and we managed to escape."
The lack of clean drinking water has triggered an epidemic of water-borne diseases, and an AFP correspondent saw dozens of children being treated at a clinic in the town of Harawa, 40 kilometres east of Sirte.
"We have medicines but no nurses to treat the constant flow of patients, mainly children, suffering from vomiting and gastrointestinal diseases," said Dr Valentina Rybakova, a Ukrainian working in Libya for eight years.
"This is a big humanitarian crisis. We are trying to get help from everybody but the main problem is that these people have no access to clean drinking water," she said.
As the fighting raged in Sirte, a group of fighters from the Zintan Brigade discovered a huge weapons cache in houses of a village several kilometres (miles) south of the city, one of them told AFP.
"The stock is massive. Around 100 houses in the village were full of all kinds of ammunition," said Maatiz Saad.
"The stock is so big that we would need hundreds of pickup trucks to load it and move it out. Ammunition was stored even in the village hospital. There are bullets for all kinds of guns and hundreds of rockets."
The claim could not be immediately verified.
In Gaddafi's radio message, a transcript of which was carried by a loyalist website, the toppled strongman said he was still fighting and was ready to die a martyr.
"Heroes have resisted and fallen as martyrs and we too are awaiting martyrdom," Gaddafi said.
The toppled despot hailed the fierce resistance put up by Bani Walid, which had been a major recruiting ground for his elite army units.
"You should know that I am on the ground with you," he said. "Through your jihad, you are imitating the exploits of your ancestors."
NTC forces said they had stalled their offensive in Bani Walid due to the fierce resistance of Gaddafi loyalists.
"NTC fighters pulled out from some areas they control in Bani Walid due to the intensity of fire," said Abdallah Kenshil, the new government's chief negotiator in abortive efforts to broker the town's surrender.
In Benghazi, meanwhile, an NTC member said Libya's new rulers have decided to postpone formation of a transitional government until the entire country is liberated.
"Consultations have led to a decision to postpone the formation of a government until after liberation," Mustafa el-Huni said.
On Saturday, NTC chief Mustafa Abdel acknowledged "differences in views" between members of the NTC and the executive council had delayed a deal.
In other developments, Nato urged Libya's new regime to make plans to destroy stockpiles of chemical weapons and nuclear-related agents amassed by Gaddafi.
And a Tunisian appeals court overturned an illegal entry conviction against Kadhafi's ex-prime minister, Baghdadi al-Mahmudi, who had fled Libya to the neighbouring north African country, a justice ministry official said.