The UN has called for the expulsion of all mercenaries from the country.
ADVERTISEMENTLibya's two rival governments have announced an immediate ceasefire across the whole country.
It comes after nine years of conflict between the UN and Turkey-backed government in Tripoli and the France, Russia, Egypt and UAE-backed rival in Libya's east.
On Friday, the UN-supported government led by Fayez al-Sarraj called for the demilitarisation of the contested town of Sirte.
In a separate statement, Aguila Saleh, president of the rival east-based House of Representatives, also called for a ceasefire.
Both administrations called for an end to an oil blockade imposed earlier this year.
The Tripoli-based government also intends to schedule parliamentary and presidential elections for March.
Libya was plunged into chaos when a NATO-backed uprising in 2011 toppled longtime dictator Moammar Gadaffi, who was later killed by rebel fighters.
The UN mission in Libya welcomed both statements and called for the expulsion of all foreign forces and mercenaries - which are fighting on both sides - from the country.
“The two initiatives have created hope for forging a peaceful political solution to the longstanding Libyan crisis, a solution that will affirm the desire of the Libyan people to live in peace and dignity,” said Stephanie Williams, acting head of the UN mission.