Libyan rebels have succeeded in creating a defensive arc south and west of the port of Misrata by linking up two fronts, they have told the BBC.
They showed the BBC a number of soldiers from Col Muammar Gaddafi's forces who had been wounded and captured during heavy fighting earlier on Tuesday.
The fighting left at least 11 people dead around the city, rebels say.
They are trying to break out of Misrata to advance on the capital Tripoli.
Since anti-government protests turned into armed rebellion more than four months ago, the two sides have been locked in a stalemate, despite a Nato-led air campaign against Col Gaddafi's forces.
Rebels hold much of Libya's east, plus Misrata and several towns in the Nafusa mountains near the Tunisian border.
Tuesday also saw clashes around Brega in the east and the Nafusa mountains on the Tunisian border, but the BBC's Gabriel Gatehouse in Misrata said neither side was making significant progress.
The latest fighting began early on Tuesday, with firing and shelling from both sides continuing well into the afternoon, our correspondent says.
Meanwhile, rebel positions in Dafniya came under heavy fire as government forces attempted an advance, reports said.
A hospital worker in Misrata told Reuters news agency that 11 rebel fighters were killed and dozens wounded while a rebel source told AFP news agency that 11 people "almost all of them civilians" had been killed.
Operating under a UN mandate, Nato and several Arab states have been carrying out air strikes against military targets linked to Col Gaddafi for nearly four months, mandated to defend civilians from the Libyan leader's attempts to crush an uprising against him.
Pressure has been growing to find an end to the conflict, but the rebels insist Col Gaddafi must step down. So far he has refused.