Muammar Gaddafi urged Libyans Monday to free the country from "traitors," as rebels in the west began to strangle a major lifeline to his capital.

His broadcast appeal was made over a bad telephone line from an undisclosed location. In the following hours, a senior figure in his government showed up in Cairo with his family.

Egyptian sources said Nasser al-Mabrouk Abdullah, described as interior minister, flew to Cairo airport with nine relatives, from the Tunisian island resort of Djerba. He told officials he was on holiday. There was no immediate comment from Tripoli.

Unnamed envoys of Gaddafi's government were reported to have held talks with rebels at a Djerba hotel Sunday, on a possible resolution of the 6-month-old civil war.

A dramatic advance Saturday won rebels control of the town of Zawiyah, 50 km (30 miles) west of Tripoli on the coast, enabling them to halt food and fuel supplies from Tunisia.

Tripoli was under no immediate threat, but rebels are now in their strongest position since the uprising against 41 years of Gaddafi rule began in February.

"The fall of Zawiyah would be the biggest milestone for the rebels since the liberation of Misrata. It's a real morale booster for them and implies a sense of momentum," said analyst Shashank Joshi of the Royal United Services Institute in London.

"It is home to the regime's only functioning oil refinery," he added. But rebels say said Gaddafi's forces still controlled the Zawiyah oil refinery, which lies on the coast.

British Prime Minister David Cameron, a leading figure in the anti-Gaddafi coalition, said via a spokesman that "we think the NATO operation is proving successful in eroding Gaddafi's ability to wage war against his own people."

The rebels have help from NATO warplanes which are bombing Gaddafi's army under a U.N. mandate to protect civilians.

ZAWIYAH CIVILIANS KILLED

Medics outside Zawiyah Monday said sniper and mortar fire by Gaddafi forces killed three civilians. One man was shot in the head and a 15-year-old girl died of shrapnel wounds.

Waleed, brother of a wounded woman, said Gaddafi forces were "shooting at us indiscriminately."

A doctor said Zawiyah teaching hospital, with 600 beds, had been taken over by the military and turned into huge weapons storage area, particularly the floor under the maternity ward.

Libyans fleeing south in their cars reported gunfire in a place called Harsha, between Tripoli and Zawiyah.

"I heard fighting there today on our way here," said one man who declined to give his name. He also said rebels clashed with Gaddafi's security forces inside Tripoli Sunday night.

"There is no gasoline, no electricity, food prices are up 300 percent. We just cannot live like this anymore," he said.

Gaddafi's latest speech early was delivered over a poor quality telephone and broadcast by state TV in audio only.

"The Libyan people will remain and the Fateh revolution (in which he seized power in 1969) will remain. Move forward, challenge, pick up your weapons, go to the fight for liberating Libya inch by inch from the traitors and from NATO."

"The blood of martyrs is fuel for the battle," said the 69-year-old leader. "The end of colonialism is near. The end of the rats (rebels) is near, as they flee..."

In Zawiyah, rebel fighter Khalid Al-Zawi said: "Gaddafi is crazy. He's capable of absolutely anything. That's one thing we have to keep in mind."

FIGHTING SPREADS WEST, SOUTH

In Tunisia's resort island Djerba Sunday, security men turned Reuters away from a hotel where a source, who spoke on condition of anonymity, said the talks between rebel and government representatives were being held. ID:nLDE77D089]

In Tripoli, government spokesman Moussa Ibrahim blamed denied this report as "part of a media war against us."

"The leader is here in Libya, fighting for the freedom of our nation. He will not leave Libya," Ibrahim said.

Gaddafi's characteristically defiant speech followed a day of action across a swathe of northwest Libya during which rebels said they had seized the town of Surman, next door to Zawiyah.

There was also fighting in the town of Garyan that controls the southern access to Tripoli, and shooting was heard near the main Libyan-Tunisian border crossing.

Rebels from the Western Mountains region to the south advanced into Zawiyah late Saturday, and early Sunday, about 50 rebel fighters milled around the central market.

If the various rebel units in the west act in concert they can field a force of a few thousand fighters.