Heavy gunfire has broken out in Tripoli as forces loyal to Moammar Gaddafi tighten their grip on the Libyan capital, but anti-government protesters have consolidated gains in the east of the country, reports said.
Anti-government protesters have claimed control of many cities, while top government officials and diplomats have turned against their longtime leader, AAP reported.
Over 640 people have been killed in recent days, the International Federation for Human Rights (IFHR) said on Wednesday.
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Residents in Tripoli are afraid to leave their houses saying pro-Gaddafi forces were Wednesday night still opening fire randomly in the streets.
As refugess reportedly piled over Libya's borders, pressure was mounting on the international community to act.
The United States - already a long time foe - is mulling a "full range of tools" including sanctions against Libya to stop a deadly crackdown on anti-regime protesters there, the State Department said on Wednesday.
"We're looking at a full range of tools and options that are available to us to achieve our goals of seeing an end of the violence in Libya and respect for the rights of the Libyan people," spokesman Philip Crowley said, according to the AFP.
"That certainly includes looking at sanctions that could be imposed either bilaterally or multilaterally," Crowley told reporters.
"We believe it's important to coordinate our effort with the international community, our European allies, the United Nations and organisations like the Arab League," he said, adding that Washington "will be consulting broadly about these issues in the coming days."
The White House said President Barack Obama will speak publicly about the situation in Libya later on Thursday and expects to make some "announcements" on a US response to the crackdown.
White House spokesman Jay Carney said Washington was discussing a wide range of options with its international partners, including the possibility of reimposing some sanctions on Libya's government.
EU acts on sanctions
Europe already moved on Wednesday to isolate Libyan strongman Muammar Gaddafi, readying sanctions that one diplomat said could include an assets freeze, a travel ban, an arms embargo and the legal pursuit of those involved in violent repression.
US MPs from both sides of the political aisle have made strong calls for the White House to slap sanctions on Libya.
US Senator John Kerry, who chairs the Senate Foreign Relations Committee, has urged Obama to re-impose US sanctions lifted under his predecessor George W Bush when Tripoli agreed to dismantle its nuclear program.
House or Representatives Foreign Affairs Committee chair Ileana Ros-Lehtinen also called for sanctions, including "freezing assets of the regime and imposing a ban on travel for all senior regime officials and their families," she said.
