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Fighters loyal to Libya's unity government were endured bloody clashes and car bombs on Wednesday, as the Islamic State group launched a devastating counter-offensive in the west of the country.

Around 32 government troops were killed in the fighting, and at least 50 injured, as fighters clashed with jihadi militants close to IS' Libyan stronghold of Sirte.

"The toll of today's martyrs reached 32, and 50 others were wounded," the operations room set up by the new Government of National Unity (GNA) said on its Facebook page and Twitter account late Wednesday, updating an earlier toll of 18 dead.

Of the earlier toll, seven died in a car bomb attack in Buairat el-Hassun, 60 kilometres (35 miles) west of Sirte and the others were killed in an IS counter-attack at Abu Grein, a strategic crossroads that unity government forces recaptured on Tuesday.

IS overran Abu Grein on 5 May and has been winning territories from the UN-backed Libyan government, sweeping westwards from their base in Sirte.

The unity government have been leading the fight against IS forces in Libya, after the jihadi group took swathes of coastal territories and deserts close to oil fields from last summer.

Earlier this week, the Tripoli-based government backed plans for an arms embargo on it to be dropped, and called for fresh arms to use against IS.

This includes war planes, and comes as Europe fears Sirte's airport and port could be used by IS to launch attacks on Libya. 

Meanwhile, IS militants have launched a campaign of terror against Sirte residents, and carried out a wave of public beheadings, shootings and lashings in the coastal city.

Agencies contributed to this story.