The U.N. Security Council early this year referred Gadhafi and members of his inner circle to the International Criminal Court for alleged crimes against humanity committed against the civilian population since February.
ICC prosecutor Luis Moreno-Ocampo said in May he had evidence that civilians were attacked in their homes, demonstrators were fired on with live ammunition and snipers were used to kill those leaving mosques after prayers.
The court Monday issued arrest warrants for Gadhafi, his son Saif Gadhafi and the country's intelligence chief Abdullah al-Sanousi for crimes against humanity.
The court in the arrest warrant for Gadhafi said there are "reasonable grounds" to believe that "murders constituting crimes against humanity" were committed as part of an attack against civilian demonstrators protesting the regime.
British Foreign Secretary William Hague said in a statement the arrest warrant shows that Gadhafi is no longer a legitimate leader in Libya.
"The warrants further demonstrate why Gadhafi has lost all legitimacy and why he should go immediately," he said in a statement. "His forces continue to attack Libyans without mercy and this must stop."
The chief prosecutor told al-Arabiya that Gadhafi's son was responsible for hiring mercenaries to quash the rebellion. The intelligence chief, he added, was a conspirator in the crimes committed against the Libyan people.
He added that he expected Gadhafi would be arrested before the end of the year.