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| Wounded fighters were taken to hospital in Gharyan |
Rival armed groups fired rockets and heavy machine guns around the town of Gharyan, about 80km (50 miles) south of the capital, Tripoli.
The Libyan authorities say they are now raising a force to disarm what they say are Gaddafi loyalists.
Local officials in Gharyan told the BBC they were powerless to control some of their own revolutionary brigades.
Prisoner exchange bid
In the hills surrounding Gharyan there were scenes rarely seen in Libya since the capture and killing of Col Muammar Gaddafi nearly three months ago - revolutionary forces are again in position, their anti-aircraft guns mounted on the backs of pickup trucks pointing west towards the town of Assabia.
The fighting started on Friday and continued sporadically throughout the weekend.
On Saturday, Libyan Defence Minister Osama al-Juweili travelled to the town to try to broker a ceasefire. It did not hold.
The local officials in Gharyan told the BBC that militia groups in Assabia remained loyal to the former Libyan ruler, and should be disarmed - by force if necessary. On Sunday, a delegation of tribal elders arrived in Gharyan in an attempt to mediate in the dispute and to negotiate a prisoner exchange.
But the stand-off continues, and the situation remains tense.
Libya's interim government is pressing the country's various armed groups to hand in their weapons, giving them the option of joining a national army.
But so far it has met with only partial success.
Earlier this month, Libya's interim leader warned of the dangers of a civil war if the militias are not disarmed.
There are rivalries here that go back decades. And to old grievances the revolution has added new guns.
River to Sea
Uprooted Palestinian The views expressed in this article are the sole responsibility of the author and do not necessarily reflect those of this Blog!
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