Libya's interim government forces use tanks to bombard pro-Gaddafi fighters in Sirte on Tuesday.
Intense fire from loyalist fighters - had forced anti-Gaddafi fighters to retreat in areas of the coastal city.
National Transitional Council Field Commander Ismael Salaby said more than 500 hundred loyalists were still hiding in Sirte.
SOUNDBITE: National Transitional Council Field Commander Ismael Salaby
"I never thought that Gaddafi is here, but now I'm eighty five percent sure that Gaddafi is in Sirte."
Capturing Gaddafi's hometown and the last loyalist holdout will give the interim government nominal control over all of Libya and allow for democracy-building.
But, the anti-Gaddafi forces - made up mostly of amateur fighters - have had coordination problems.
Visiting Libya, U.S. Secretary of State Hillary Clinton urged the NTC to unite the various militias.
SOUNDBITE: U.S. Secretary of State Hillary Clinton
"Groups and individuals who really believe in democracy should be welcomed into that process. But groups that want to undermine democracy or subvert it are going to have to be dealt with the Libyans themselves."
Clinton is the most senior U.S. official to visit Tripoli since it fell in August.
Her visit was marked with tight security - reflecting worries Libya's new government has yet to gain full control.
Sarah Irwin, Reuters.