Qaddafi addressed supporters and foreign media on Wednesday in a conference hall in the capital Tripoli as his forces were launching a counteroffensive against parts of the rebel-held eastern half of the country.
"We will fight until the last man and woman. We will defend Libya from the north to the south," he said.
The United States is moving naval and air forces closer to Libyan shores and is calling for Qaddafi to give up power immediately. The U.S., Britain and other NATO countries are drawing up contingency plans to impose a no-fly zone over Libya to prevent Qaddafi's air forces from striking rebels. But any no-fly zone would need a mandate from the U.N. Security Council, where veto-holding Russia opposes the idea.
Britain, Spain, France and others also launched emergency airlifts along Libya's borders Wednesday, trying to prevent racially charged attacks on the tens of thousands of foreign workers try to flee.
"We will not accept an intervention like that of the Italians that lasted decades," Qaddafi said, referring to Italy's colonial rule early in the 20th Century. "We will not accept a similar American intervention. This will lead to a bloody war and thousands of Libyans will die if America and NATO enter Libya."
In his address, meant to mark the anniversary of the creation of the the people's congress of Libya, Qaddafi insisted that the congress, not himself, was the true source of power in the country, reports CBS News correspondent Harry Smith. Instead, he referred to himself as simply the moral authority of the country, and thus had nothing to step down from.
Qaddafi also lashed out at international moves against his regime, including the freezing of his and other Libyan assets abroad -- an act he called "piracy" -- and efforts by Europe to send aid to opposition-held Benghazi. He said any Libyan who accepts international aid was guilty of "high treason" because it "opens Libya to colonialism."
In a pointed message to Europe, he warned, "There will be no stability in the Mediterranean if there is no stability in Libya."
"Africans will march to Europe without anyone to stop them. The Mediterranean will become a center for piracy like Somalia," he said. Qaddafi's regime has worked closely with Italy and other European countries to stop African migrants who use Libya as a launching point to slip into Europe.
He also threatened to bring in Chinese and Indian companies to replace Western companies in Libya's oil sector if the West keeps up its pressure on him. European firms are heavily involved in Libya's oil production.
As Qaddafi spoke, regime opponents battled forces loyal to him who tried Wednesday to retake a key oil installation in a counteroffensive Wednesday against the rebel-held eastern half of the country. At one point in the flip-flopping battle, anti-Qaddafi fighters cornered the attackers in a nearby seaside university campus in fierce fighting that killed at least five.
The assault on the Brega oil port appeared to be the first significant attempt by Qaddafi's regime to push back against the large swath of territory in opposition hands -- almost the entire eastern half of the country. For the past week, pro-Qaddafi forces have been focusing on the west, securing his stronghold in the capital Tripoli and trying to take back nearby rebel-held cities with only mixed success.
Meanwhile, two U.S. warships have passed through the Suez Canal on their way to the Mediterranean Sea and closer to Libyan shores after orders from Defense Secretary Robert Gates, Egyptian officials said Wednesday.
The amphibious assault ships USS Kearsarge and USS Ponce entered the canal earlier in the day from the Red Sea. The officials said the USS Kearsarge is carrying 42 helicopters.
The two officials spoke on condition of anonymity because they are not authorized to talk to the media.
Gates said he ordered two Navy amphibious warships into the Mediterranean, along with an extra 400 Marines, in case they are needed to evacuate civilians or provide humanitarian relief.
And while he did not rule out other options, such as providing air cover for Libyan rebels, he made clear he has little enthusiasm for direct military intervention.