"Libya's revolution was facing collapse as Muammar Gaddafi's forces broke through the last major line of resistance before Benghazi, the heart of the uprising and the seat of the rebel administration.
Pro-government forces pushed back the rebels in an air and land assault on the town of Ajdabiya, as the regime moved to crush the revolution once and for all before foreign powers could agree measures in support of the uprising, including a no-fly zone.
The rebels had pledged a vigorous defence of Ajdabiya but swiftly lost control of large parts of the town, including the strategically important coastal road, although pockets of fighting continued. The regime's advance leaves the road open to Benghazi, 90 miles away, where there was growing alarm as word of the latest military setback spread.
"The battle is lost. Gaddafi is throwing everything against us," a rebel officer who gave his name as General Suleiman told Reuters. Last night the revolutionary council, which had promised a fight to the death claimed to be in full control of Ajdabiya, but some Benghazi residents were fleeing to the Egyptian border amid considerable bitterness at the failure of western countries to back vocal support for the rebels with practical help, including a no-fly zone and military equipment to fight Gaddafi's armed forces, some trained by the British army.
The assault came as the US finally joined the UK and France in supporting a draft UN resolution imposing a no-fly zone over Libya.
A vote on a draft motion is expected later this week or early next week, which is likely to be too late for the rebels.Libyan state television declared: "The town of Ajdabiya has been cleansed of mercenaries and terrorists linked to the al-Qaida organisation."
The setback in Ajdabiya is the latest in a series of reverses that has seen the fortunes of the revolution set back after the initial successes that had many Libyans believing Gaddafi's regime was on the brink of collapse a fortnight ago.
Many in Benghazi are now fearful of retribution by the regime's agents and say they have no choice but to fight for their survival. But the rebel army does not appear to have made any significant preparations for the city's defence.
The assault on Ajdabiya took on a familiar pattern with Tripoli's forces first bombing then shelling the town.
Gaddafi's army then came at the town from two sides. A call went out through mosques and rebel fighters moved to the front but they said they were outgunned and began pulling back.