Italy has turned its back on Colonel Gaddafi's regime, claiming the latest proposals offered by his envoy in Athens are "not credible".
Foreign minister Franco Frattini dismissed the Libyan leader's latest overtures and confirmed Italy now recognised the rebels' interim national council in Benghazi as the "only legitimate interlocutor" in the country.
The comments by Mr Frattini are a significant rejection of Libya's deputy foreign minister Abdelati Obeidi, who travelled to Greece apparently on a diplomatic mission.
Mr Obeidi delivered a message to Greek Prime Minister George Papandreou from Colonel Gaddafi saying that he wants to find a resolution to the crisis and an end to the violence.
It is believed the foreign minister will also visit Turkey and Malta and has spoken on the phone with Prime Minister David Cameron and the leaders of Turkey and Qatar.
Only France and Qatar have so far recognised the Transitional National Council, based in the eastern Libyan city of Benghazi.
Italy's support was greeted as "a great thing" and "quite positive" by the council spokesperson Mustafa Gheriani.
However, the rebel leaders are still far from achieving success.
A security official has claimed that Al Qaeda is exploiting the conflict in Libya to acquire weapons and extend its influence to the Meditereanean.
And a Turkish humanitarian ship carrying 230 severely injured people has docked in Benghazi, bringing first-hand news of the brutal crackdown by Colonel Gaddafi's in the besieged city of Misratah.
The evacuees, suffering from bullet and shrapnel wounds and some with lost limbs, have told of conditions in the western city, which has been cut off from the world since the Libyan leader's troops moved in to take it back from the rebels.
Some of the injured took to the deck, waving to rebels and shouting: "The martyrs' blood is not spilled in vain." Many were confined to thin mats in the former cruise ship's hull.
The men described a brutal crackdown with food and water supplies cut off and snipers dressed in civilian clothing shooting at anyone who ventured outside their homes.
The ship will pick up a further 100 injured people from Benghazi before travelling to the Turkish port of Cesme where they will be treated in hospital.
Colonel Gaddafi's attempt at diplomacy follows a push by the rebels to take back the strategic oil town of Brega after weeks of back-and-forth battling along Libya's eastern coast.
Pro-Gaddafi forces have apparently been pushed to the outskirts of town as rebels, who have organised themselves better behind the leadership of army defectors, slowly gained ground.
The minor success follows a key defection from within Colonel Gaddafi's government.
Former foreign minister and intellgience agent Musa Kusa is currently being questioned in a secret location in the UK after leaving Libya via neighbouring Tunisia.
Britain is also taking the lead in the no-fly zone in Libya, along with France and other Nato allies, as the US military hands over control of the operation.
The US is expected to step back this afternoon, pulling its warplanes from frontline missions and taking on a support road.