Muammar Gaddafi's son and former heir apparent Saif al-Islam will be put on trial inside Libya and there will be a verdict before mid-June, a Libyan official said.
The decision comes despite appeals by rights groups to Libyan authorities to hand him over to the International Criminal Court in The Hague for trial amid fears that he may not get a fair trial in Libya.
A trial in the capital Tripoli would, however, mark a small step forward for the central government, which has been struggling to unify the country under its authority since Muammar Gaddafi's capture and killing last year.
Saif al-Islam had been held until now by his captors, ex-rebels from the town of Zintan, one of dozens of militias across the country operating outside government control. For months, the Zintan militia refused to give him up to Tripoli's officials.
Spokesman of the ruling National Transitional Council Mohammed al-Hareizi said that Saif al-Islam would be transferred to Tripoli within 10 days and that his trial would conclude before parliamentary elections scheduled two months from now.
It was not immediately clear if he would be tried in a military court, where there is no appeal. "He will be tried for rape, murder, corruption and we expect him to be tried and a verdict rendered before the upcoming elections in mid-June," Mr al-Hareizi told reporters in Tripoli.
No timeframe was given for when his trial would begin, but Mr al-Hareizi said the trial could start as early as this month.
Saif al-Islam staunchly backed his father in his brutal crackdown on rebels in the regime's final days, warning of "rivers of blood" if demonstrators refused to accept government offers of reform.
The eight-month civil war, which began with protests inspired by successful revolts in Libya's neighbours Tunisia and Egypt, left thousands of people dead.
Saif al-Islam was captured in the southern desert of Libya in November by revolutionary fighters from Zintan. They have kept him in a secret location in the western Libyan town ever since as the government negotiated for his handover.