A spokesperson for the rebel force in Libya says a representative for Colonel Muammar Gaddafi had offered to hold talks on the Libyan leader's exit.
The rebels rejected the offer, the spokesperson said.
There has been no comment from Colonel Gaddafi's government on the rebels' statement, but he has refused to cede power in recent utterances.
A BBC correspondent in Tripoli, says Colonel Gaddafi's side believe they are making significant military gains, consolidating their hold on western Libya.
On Monday, pro-Gaddafi forces retook the town of Bin Jawad, on the road to oil port Ras Lanuf.
Under these circumstances, it is difficult to see how the Gaddafi regime would be in any mood to compromise or talk about succession, the BBC's correspondent says.
US dismisses arms claims
The White House has denied reports that the US and Saudi Arabia are to arm anti-government rebels in Libya.
Some US politicians are calling on the Obama administration to send weapons and to impose a no-fly-zone over the country.
But US state department spokesperson, PJ Crowley, says the UN has banned all weapon shipments to Libya.
Britain and France say they are seeking United Nations authorisation to enforce a no-fly zone over Libya.
Col Gaddafi's warplanes have counter-attacked against rebels, and aid officials say a million people either fleeing from the country or staying inside it need humanitarian aid.
The Arab states in the Persian Gulf have condemned the use of violence against civilians and demanded the UN Security Council endorse a no-fly zone.
United States President Barack Obama says the US and NATO are considering a military response to the unacceptable violence being inflicted on Libya's people.
NATO is engaged in what its secretary-general has called prudent planning.
With civilians surrounded by forces loyal to Colonel Gaddafi in two western towns, Misrata and Zawiyah, fears are growing of a rising humanitarian crisis if the fighting continues.
UN Secretary General Ban Ki-moon says civilians are bearing the brunt of the violence and wants an immediate halt to the government's "disproportionate use of force and indiscriminate attacks on civilian targets".
Meanwhile, Britain's foreign secretary, William Hague, has defended deploying an SAS-backed diplomatic team to the Libyan town of Benghazi. His critics have describing the weekend detention of the team as an embarrassment to the country.
New Zealand response
Prime Minister John Key says the time has come for Col Gaddafi, to step aside. Mr Key says New Zealand is very concerned about the use of force against the Libyan people.
Foreign Affairs and Trade Minister Murray McCully says he has been keeping in touch with the international community about the turmoil in Libya. Mr McCully says New Zealand will wait and see how things play out.
