Forces of the National Transitional Council have been hitting Gaddafi's forces non-stop since this morning with heavy artillery, tanks and anti-aircraft guns, Commander Mohamed Al-Seddiq told AFP at a staging point about five kilometres behind the front.
"We are facing heavy resistance, that's why we are using the heavy artillery and not sending in any infantry for now," he said. "We will send in the infantry later.... The final battle will be in the next two days."
The desert city, 170 kilometres southeast of Tripoli, was a major recruiting ground for troops of the Gaddafi regime's elite units and has withstood a siege by forces of the National Transitional Council for several weeks.
NTC fighters at the staging point said at least six tanks had been deployed to the front line at the northern gate to Bani Walid.
Fighters were loading two more tanks with shells in readiness for deployment to the front, alongside a flatbed truck piled up with heavy ammunition.
Fighters returning from the front said the clashes were fierce.
"Our fighters are facing a lot of resistance but, God willing, we will be in Bani Walid soon," said fighter Milad Basher, who had just returned from the northern gate.
Sitting in a pick-up truck with an anti-aircraft gun mounted on the back, fighter Ali Beltaib said six tanks had shelled Gaddafi positions throughout the night after being deployed to the front late on Sunday.
"The tanks and the anti-aircraft guns have been shooting constantly," he said, as he prepared to return to the front after reloading with fuel and ammunition.
Seddiq said he did not know how many casualties NTC fighters had sustained, but a frontline medic, Ahmed Abar, said at least two had been killed by incoming artillery fire during the night.
With Gaddafi's hometown of Sirte, Bani Walid is one of two remaining bastions where fighters loyal to the ex-strongman are holding out against NTC forces.
NTC fighters suffered heavy losses when they first tried to take the city in a chaotic assault early this month but Seddiq said they were better organised this time.
"Before there was chaos and now everything is under control, with all orders coming from the national army," he said.
A senior commander near Bani Walid, Omar Mukhtar, told AFP on Sunday that NTC forces were regrouping for a major assault, but were waiting for Sirte to be captured before proceeding with a final push.