"The regime in Libya will not fall -- it is based on the people, not on Kadhafi. NATO is wrong if it thinks it can topple the regime of this country," Kadhafi told thousands of supporters in Sabha, some 750 kilometres (450 miles) south of Tripoli, in an audio message.
"Our only choice is resistance: we are on home ground and are not afraid of your war machine," he told supporters in his clan's desert stronghold, addressing NATO directly.
Despite the fighting, the rival factions are in talks with the United Nations to try to avert an acute shortage of medical and other essential supplies caused by international sanctions on the country, AFP has learned.
Well-placed UN officials said representatives from Libya's rebel council and the Kadhafi regime held talks last week with the World Health Organisation aimed at drawing up a list of items for sanctions relief.
Rhetoric reverberating through Tripoli on Friday showed no sign of any common cause with the opposition, with clerics damning the rebels and their NATO backers.
"The hour of jihad (holy war) has sounded," an imam said at Friday prayers in the capital's Green Square, stirring the faithful to obvious anger.
"Our country has been invaded by the crusader forces helped by traitors," he said, calling on the worshippers: "March on them."
To rebels in Benghazi and eastern Libya which they control, the imam warned: "Distrust the traitors, they want to sell the country to the crusaders and enemies of God. Do not have confidence in them and learn the lesson from the invasion of Iraq" led by the United States in 2003.
In Washington, the US House of Representatives voted to forbid the Pentagon from arming, training, or advising the strife-torn North African nation's rebels.
The provision, as part of the Defence Bill, now goes to the Senate where it may face stiff opposition.
Republican Senator John McCain denounced the vote as "deeply disturbing."
McCain, a strong supporter of the rebels, said it "sends exactly the wrong message to Kadhafi and those fighting for freedom and democracy in Libya -- especially since Kadhafi is clearly crumbling."
However, the strength of Kadhafi's position still appeared unclear, with fighting continuing and huge pro- and anti-Kadhafi rallies in Libya's towns and cities.
Wing Commander Mike Bracken, the NATO mission's military spokesman, said "anti-Kadhafi forces look to have the initiative and are able to launch successful attacks against pro-Kadhafi forces."
But Kadhafi forces still hold two cities west of the capital Tripoli, Zawiyah and Zuwarah, and are "rearming, regrouping and fighting in places such as Kikla, Misrata and Dafnia," he added.
In its latest sortie update, NATO said its aircraft on Thursday attacked close to Tripoli, targeting three anti-aircraft guns and a command and control centre.
Another raid took out military refuelling equipment near the eastern oil town of Brega, where the western alliance attacked eight armoured vehicles and military refuelling equipment on Wednesday.
An AFP reporter on Friday saw an air strike near rebel-held Gualish, and said the rebels reported that Kadhafi loyalists had failed to break through to the desert hamlet late on Thursday.
In Europe, which is carrying out the lion's share of foreign involvement in the fighting, Poland said it had opened diplomatic ties with the rebel National Transitional Council (NTC), installing its ambassador in Benghazi.
Warsaw currently holds the rotating European Union presidency.
Meanwhile UN chief Ban Ki-moon called on Libya's regime to allow a peaceful transition to end the war. He urged Libyan Prime Minister Baghdadi al-Mahmudi to stop the fighting, which began in February, and help improve humanitarian conditions.
On Thursday, Ban stressed in a phone call "the urgent need to find a way out of the current fighting and alleviate the dire humanitarian situation and work out a transition that could bring peace to all Libyans," his office said.
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