IN PIX: Tripoli erupts with joy as Gaddafi regime crumbles

As Libyan rebels surged into Tripoli, in a seemingly final drive to drive out Muammar Gaddafi, thousands of residents poured into the streets to welcome them, assembling into the square which is now being called the Martyr's Square.

Many of them waved anti-regime flags, shouted Allahu Akbar, and fired rifles in the air.

Observing that the momentum against Gaddafi regime has reached a tipping point and that Tripoli is slipping from the grasp of a tyrant, US President Barack Obama on Sunday said the Libyan leader needs to acknowledge the reality that he no longer controls the country and should immediately relinquish power.

"The momentum against the Gaddafi regime has reached a tipping point. Tripoli is slipping from the grasp of a tyrant. The Gaddafi regime is showing signs of collapsing," he said.

"The people of Libya are showing that the universal pursuit of dignity and freedom is far stronger than the iron fist of a dictator," Obama said in a statement on Sunday.

Obama said the surest way for the bloodshed to end is simple: Muanmmar Gaddafi and his regime need to recognise that their rule has come to an end. "Gaddafi needs to acknowledge the reality that he no longer controls Libya. He needs to relinquish power  once and for all," he said.

Gaddafi, on the other hand, pledged not to surrender in an audio broadcast on Sunday, as fighting between the rebels and his forces flared in and around Tripoli.

Gaddafi claimed that he was in Tripoli, and would defend his city. He called on his supporters, and urged them to defend the city, and 'emerge victorious', rather than surrender.

The speech came as rebels declared that they had some parts of the city under their control.

Meanwhile, North Atlantic Treaty Organisation has said the Gaddafi regime in Libya is crumbling and all threats against civilians should stop now.

"The Gaddafi regime is clearly crumbling. The sooner Gaddafi realises that he cannot win the battle against his own people, the better, so that the Libyan people can be spared

further bloodshed and suffering," NATO Secretary General Anders Fogh Rasmussen said on Sunday.

"Now they have a chance for a new beginning. Now is the time for all threats against civilians to stop, as the United Nations Security Council demanded," he said.

"Now is the time to create a new Libya a state based on freedom, not fear; democracy, not dictatorship; the will of the many, not the whims of a few," Rasmussen said.

"That transition must come peacefully. It must come now. And it must be led and defined by the Libyan people," he said adding that NATO is ready to work with the Libyan  people and with the Transitional National Council, which holds a great responsibility.

Observing that Gaddafi's remaining allies and forces also have a great responsibility, he said it is time to end their careers of violence.

"The world is watching them. This is their opportunity to side with the Libyan people and choose the right side of history," Rasmussen said. NATO he said will continue to monitor military units and key facilities as it has since March.

"When we see any threatening moves towards the Libyan people, we will act in accordance with our UN mandate," he added.

"Our goal throughout this conflict has been to protect the people of Libya, and that is what we are doing. Because the future of Libya belongs to the Libyan people," he said.

It is for the international community to assist them, with the United Nations and the Contact Group playing a leading role, he said.

"NATO wants the Libyan people to be able to decide their future in freedom and in peace. Today, they can start building that future," Rasmussen said.