Zintan, Libya (CNN) -- Libyan rebels said Monday they remain in control of a key western town they seized from Moammar Gadhafi forces Saturday, although clashes continued just east of it.

The Libyan government said earlier its forces had retaken Bir al-Ghanam but Jumma Ibrahim, a rebel spokesman in the western mountain region, said the claims were false.

Rebel commander Nasser abu al Qassem told CNN Monday that the rebels are holding firm on the town's eastern outskirts, squaring off against loyalists just a few miles away at a key road junction the rebels hope to take in the days ahead.

He reported regular exchanges of fire between the two sides.

The rebels entered Bir al-Ghanam in June but only held it for a matter of hours. Capturing the town puts the rebels closer to Tripoli than they've been before. The town is about 85 kilometers (53 miles) southwest of the Libyan capital.

Meanwhile, bombs rained down on Tripoli overnight, the sky lit up by explosives. Multiple airstrikes and secondary explosions could be heard continuously for the better part of an hour.

Entire neighborhoods of the city were already without electricity -- due to shortages of fuel -- prior to the pre-dawn strikes. Parts of Tripoli have been suffering for days from such blackouts.

Gadhafi's forces fired several rockets Sunday in Bir al-Ghanam, causing minor damage inside the town but no rebel injuries, al Qassem said. He reported no further rocket attacks so far Monday.

Al Qassem said NATO forces had informed the rebels that the Gadhafi forces included up to 40 trucks outfitted with heavy weapons, and rebel forces had reinforced their positions Sunday and overnight into Monday. He was confident the rebel lines would hold and said there had been no concerted effort so far by the government troops to try to re-take Bir al-Ghanam.

The battle to take Bir al-Ghanam lasted for nearly five hours Saturday and was fought on three fronts. CNN witnessed heavy rocket, mortar and anti aircraft gun fire from the rebel side at one front near a Gadhafi military encampment three kilometres west of the town. Gadhafi forces returned fire with rockets and mortars.

Commanders said taking the junction where Gadhafi forces remain east of the town would provide a direct route to the coastal city of Azzawayia.

They told CNN they wouldn't reveal a timetable to move further forward, but said there would be "surprises from the fighters of Zintan very soon.

For months, rebel fighters -- who control the eastern city of Benghazi and other areas -- have been trying to move closer to the capital. They are seeking the ouster of Gadhafi, who has ruled Libya for 42 years.

CNN's Ivan Watson contributed to this report from Tripoli.