BENGHAZI, LIBYA - Gunfire erupted in at least three neighborhoods of the Libyan capital of Tripoli Friday, as opponents of Moammar Gaddafi tried to revive their protests against his regime in spite of a massive security clampdown.

Hours earlier, Libyan state television announced that the government would distribute $400 to each family in a bid to head off fresh demonstrations called for by regime opponents after Friday's midday prayers.

It was the first time the regime--which also pledged pay hikes for state employees of up to 150 percent-- has attempted to offer incentives to Libyans to remain loyal.

Gunfire was reported shortly after prayers finished, suggesting that some protesters were attempting to take to the streets, said a caller from Tripoli who requested anonymity because he feared for his life.

But it was unclear whether Tripoli's residents would be able to counter the massive presence of police, army soldiers and paramilitaries who descended on the city Thursday evening to protect one of Gaddafi's last remaining strongholds.

"Everybody's suspicious, worried, afraid, because we have families," said the caller, a trader who said he did not dare go out to protest. Gunshots could be heard over the telephone line. "We are 10 percent afraid for ourselves and 90 percent afraid for our families. They won't just shoot us, maybe they will get revenge on the whole household, the whole family, even the whole street.

"These people have no mercy," the caller added. "We have known them for 42 years."

"Fear, fear, fear," was how another businessman described the mood in the city Thursday evening. But he nonetheless predicted a big turnout for Friday's demonstrations. "It's now or never," he said of the effort to intensify the rebellion in Gaddafi's stronghold, where forces loyal to the Libyan leader forcefully suppressed an earlier wave of protests.

Across the Middle East and North Africa, demonstrators again gathered on the Muslim holy day to call for democracy and government reforms. In Iraq, tens of thousands of Iraqis defied curfews to take the the streets for what was billed as "A Day of Rage." Several deaths were reported.

In Cairo, thousands of Egyptians gathered in Tahrir Square to commemorate the beginning of their revolution exactly one month ago, and to remind the military council ruling the country that many demands remain unmet.

A strong undercurrent of support for neighboring Libya was palpable, with chants and banners proclaiming "Egypt and Libya, we are one."

The Egyptian demonstrators called on the Supreme Military Council to replace the prime minister and his cabinet, lift a long-standing and repressive emergency law and put the interior ministry police under civilian control. "We don't want this government," said Mariam Abdel Rehim, 27, who is working on a master's degree in physical education. "It was formed by the former president."