Libyan leader Muammar Gaddafi refused to step down in a televised speech broadcast by Libyan state TV Tuesday evening, while warned demonstrators they might face death sentence if they restored to violence.

Gaddafi said in his speech outside one of his residences that he still retains control over the capital Tripoli, and said he would call the people to "cleanse Libya house by house" unless protesters on the streets surrendered.

He also vowed that he would not give up, as leaders of Tunisia and Egypt did.

"Gaddafi does not have a post to resign from, Gaddafi is the leader of the revolution forever," he said in his first major address since anti-government protests erupted last week.

"I am a warrior," he said, adding "I am not going to leave this land, and I will die here as a martyr."

"I have not yet ordered the use of force, not yet ordered one bullet to be fired ... when I do, everything will burn," said Gaddafi.

He called on supporters to take to the streets to show loyalty, saying "You men and women who love Gaddafi, get out of your houses and fill the streets. Chase them, arrest them, hand them over to the security (forces)."

"From tonight to tomorrow, all the young men should form local committees for popular security," he said, telling the people to wear a green armband to identify themselves.

"The Libyan people and the popular revolution will control Libya," he said in a defiant tone.

Gaddafi blamed the unrest on "cowards and traitors" who were seeking to portray Libya as a place of chaos and to "humiliate" Libyans.

Inspired by streets-born uprisings which swept Tunisia and Egypt and forced their leaders to step down, thousands of Libyans have started a string of protests against Gaddafi, in power for 42 years.

With more bodies found in the capital Tripoli, opposition groups and Al-Arabiya TV said more than 500 have been killed and around 1,400 people are still missing since the unrest began in the North African country.

The Libyan unrest has sparked strong response all over the world.

U.S. Secretary of State Hillary Clinton on Tuesday condemned as "completely unacceptable Libya's crackdown on anti-regime protesters" and called on Tripoli to respect the rights of its people.

"This bloodshed is completely unacceptable," Clinton told reporters at the State Department, adding "It is the responsibility of the government of Libya to respect the universal rights of their own people, including their right to free expression and assembly," she said.

UN Secretary-general Ban Ki-moon on Tuesday expressed his concern over reports of grave violations of human rights in Libya.

Ban reaffirmed the "need for the international community, in particular Arab leaders and the UN, to call for an immediate end to these acts of violence, and for the launch of a broad-based dialogue."

German Chancellor Angela Merkel on Tuesday warned the Libyan government of risking sanctions if it continues to use violence against the people.

If the violence doesn't stop, Germany will push for all possible measures, including sanctions, to put pressure on the Libyan government, Merkel told a news conference in Berlin.

Earlier in the day, German Foreign Minister Guido Westerwelle sent the same message to the Libyan government, saying that "if Libya continues to proceed with violence against its own people, sanctions will be unavoidable."