Libyan rebel forces massed for an attack on one of ousted leader Moammar Gaddafi’s last bastions Sunday night, as their effort to negotiate the peaceful surrender of the desert town of Bani Walid broke down.

“From my side, negotiations are finished,” the rebels’ chief negotiator, Abdullah Kanshil, told reporters at the site of earlier roadside talks with tribal elders from the town. “They said they don't want to talk, they are threatening everyone who moves. They are putting snipers on high-rise buildings and inside olive groves. They have a big fire force.”

The town of 60,000 people, 104 miles southeast of Tripoli, has no electricity, water or fresh food and is desperately short of medical supplies, officials said. Rebels had offered to bring in ambulances, doctors and supplies, but they insisted their fighters had to enter the town at the same time, a condition tribal elders did not accept.

Col. Ahmed Bani, spokesman for Libya’s new Defense Ministry, told al-Jazeera on Sunday night the town would be “liberated” in hours but added that he hoped people in Bani Walid would rise up to greet anti-Gaddafi forces, as happened in Tripoli.

In the capital, the rebels’ Transitional National Council announced plans to integrate 3,000 rebel fighters into the police force and find training and civilian jobs for others.

That move may partly be a reflection of the fact that many members of the Gaddafi-era police force have yet to respond to an appeal to return to work, apparently fearing retribution. But mainly it is an attempt to find roles for many excited young men with guns who could otherwise destabilize the country.

“They will give up their weapons,” said interim Interior Minister Ahmad Darat. “It's just a matter of time and organization.”

At the same time, though, the fighting is not over. In the town of Tarhouna outside Tripoli, fighters in pickup trucks mounted with antiaircraft guns and heavy machine guns left a military camp for Bani Walid on Sunday morning ready for battle.

“We’re going into the red fire. If we die, we die,” they sang, as they paused by the side of the road. Then, a little more optimistically, they continued: “No clashes, no tanks, we’ll beat them by saying the name of God.”

Fighters were approaching Bani Walid from Tripoli and Misurata, to the northeast, and were camped about 10 miles outside the town. The advance had met little resistance, with the Misurata group overrunning two abandoned military camps.

The rebels had extended a surrender deadline more than once, their caution driven by military, as well as political, concerns.

The people of Bani Walid have a reputation of being heavily armed, and a forced entry could cost many lives. In addition, many of the anti-Gaddafi fighters are members of the Warfala tribe that dominates Bani Walid, and some have relatives there.

Commanders say there are convincing reports that Gaddafi’s son Saif al-Islam fled the town Saturday after attending the funeral of his younger brother Khamis, a military commander who was ambushed and killed on his way to Bani Walid last month. But Kanshil said he believed two other sons, as well as former government spokesman Moussa Ibrahim, were still there.

Members of the Transitional National Council have said Gaddafi may also have passed through Bani Walid since fleeing Tripoli last month. While his whereabouts remain unknown, most people here think it unlikely that Gaddafi is in his hometown of Sirte, which is surrounded by rebel troops.

NATO, which continues to interpret its mandate to protect civilians loosely, reported bombing an ammunition dump near Bani Walid overnight, as well as several military targets in Sirte.