Libyan leader Muammar Gaddafi threatened retaliation against Europe on Friday unless NATO ceases its operations, saying loyalist forces can launch stinging attacks like ‘locusts and bees.’

The embattled leader also urged supporters to retrieve weapons that France supplied to rebels battling his regime, in a speech broadcast by loudspeakers to crowds in Tripoli's emblematic Green Square.

"The Libyan people are capable, one day, of taking the battle to Europe and the Mediterranean" region, Gaddafi said in the message, as thousands of supporters massed in the landmark square in the centre of the capital.

"They could attack your homes, your offices, your families (who) could become legitimate military targets because you have transformed our offices, headquarters, homes and children into military targets which you say are legitimate," Gaddafi said.

"If we decide to do so, we are capable of throwing ourselves on Europe like swarms of locusts or bees.

"So we advise you to back-track before you face a catastrophe," he warned in a speech to mark 100 days of the NATO military campaign against the North African country.

The flamboyant Gaddafi was speaking from a secret location, but his voice boomed across the square, where the authorities were hoping to gather one million regime supporters.

The crowds, waving green flights and carrying portraits of Gaddafi, chanted slogans of allegiance to "God, Gaddafi and Libya," while some fired guns into the air in celebration as the night sky was lit by fireworks.

"March on the jebel (Nafusa) and seize the weapons that the French have supplied. If later you want to pardon them (the rebels), that's up to you," Gaddafi said.

French Foreign Minister Alain Juppe said on Friday that this week's arms drop was meant only to defend peaceful civilians from Gaddafi's forces and thus fell in line with existing UN resolutions on the conflict.

"Civilians had been attacked by Gaddafi's forces and were in an extremely vulnerable situation and that is why medicine, food and also weapons of self-defence were parachuted," Juppe said France Inter radio.

"It is not a violation of the UN Security Council resolutions" under which France and other allies launched air strikes and imposed embargoes to protect civilians from Gaddafi, he added.

On a visit to Moscow he later told reporters: "We believe that within the frameworks of Resolutions 1970 and 1973 -- and 1970 as a whole -- it is clear that all means are legitimate for protecting peaceful civilians."

The first resolution bans all arms deliveries to Libya -- a move Russia backed -- and the second authorises nations "to take all necessary measures" to help protect civilians against Gaddafi's forces.

Gaddafi vowed that his forces will defeat NATO and called on European leaders to talk to his people "and heads of tribes" to find a solution to the protracted crisis, saying he was ready to help.

"Pull back, you have no chance of defeating this brave (Libyan) people," he told the NATO alliance. "The Libyans will defeat the Crusader NATO forces."

"I advise you to stop your campaign and not to be led by a handful of traitors in Benghazi," he said of the rebels' eastern coastal stronghold.

He also directly addressed Italian Prime Minister Silvio Berlusconi, "poor" French President Nicolas Sarkozy and British Prime Minister David Cameron, asking them to "listen to the Libyan people who want peace."

"The people are masters of their own destiny. Discuss with them a solution to the crisis and I will help you," he said.

He promised to pursue "the fight until victory" and again said he will never leave Libya.

"We will never leave our country. We will die for it," he said.

Gaddafi urged loyalists "to liberate inch by inch" Misrata, Libya's third-largest city which is under rebel control and is a significant insurgent enclave in the west of the country.

Meanwhile, an African Union summit on Friday said African nations will not execute an International Criminal Court arrest warrant for Gaddafi, saying it "seriously complicates" efforts to find a peaceful solution to the conflict.

The ICC on June 27 issued warrants for Gaddafi, his son Seif al-Islam, and the head of Libyan intelligence, Abdullah al-Senussi, for atrocities committed in the bloody uprising.