Thirty-one Libyan rebel fighters were killed Friday during clashes with government troops in Zlitan city, dpa quoted the Quryna newspaper as reporting online.
A doctor in Zlitan, east of Tripoli, said 124 opposition fighters were wounded in the clashes, and that the toll was likely to increase because of the lack of medical supplies.
Rebels from Misurata joined forces with those in Zlitan to fight troops loyal to leader Moamer Gaddafi. Over the past weeks, the rebels have been making progress in their six-month campaign to oust Gaddafi, who has been in power for 42 years.
The head of the rebels' Transitional National Council, Mustafa Abdul Jalil, on Thursday said a final victory over Gaddafi was "on the horizon."
In London, British Prime Minister David Cameron said Friday he was "optimistic" about the recent progress made by rebel forces.
"I think this is a moment not to be complacent at all, but optimistic that we are getting closer to the future that many of us talked about," Cameron said, after a meeting with Mahmud Nacua, the diplomatic representative of the council, which was recognized by Britain last month.
The Libyan regime Thursday called for an immediate ceasefire and talks, but continued to reject demands for Gaddafi to leave power.
A Libyan dissident said in remarks published Friday that Gaddafi was seeking refuge in Arab countries and had sent a message to the governments of Egypt, Morocco, Tunisia, and Algeria to receive his family.
The representative of the council in Cairo, Abdel Monem al-Houni, told the pan-Arab newspaper Asharq al-Awsat: "Gaddafi is looking for a safe haven for his family in the case that Tripoli falls into the hands of the revolutionaries."
Al-Houni served as Gaddafi's chief delegate to the Arab League before defecting and siding with the rebels.
He said the rebels could arrive on the outskirts of Tripoli within hours as they had tightened their grip on the strategic town of Zawiya, 40 kilometres west of the capital.
"The Gaddafi regime has few days before it breathes its last," said al-Houni.
US broadcaster NBC had reported late Thursday that Gaddafi and his family could be leaving for Tunisia within days.