Washington ( CNN ) -- Even as it prepares to hand over the Libyan embassy in Washington to the rebel government , the State Department is warning the Transitional National Council to get its act together . An administration official told CNN the United States has warned the TNC that this is a `` do-or-die moment '' for the organization to carry out a credible and thorough investigation of the killing of its military commander , Abdel Fatah Younis . Last week 's mysterious assassination has raised concerns that it might have been carried out by feuding groups within the rebels themselves . `` We do welcome the Transitional National Council 's move to set up an impartial committee that will investigate the incident and we look forward to hearing the results , '' deputy spokesman Mark Toner told reporters Monday . `` It 's important that , given the fluidness of the situation on the ground , that the Transitional National Council work to ensure that it takes the right kinds of actions , such as an investigation into the death , and sends a clear and transparent message that they speak on behalf of the Libyan opposition and the Libyan people and that they are diligently carrying out their mandate . '' The TNC has been rocked by internal divisions , with rival rebel groups battling each other . The divisions create a dilemma for the Obama administration , which recognized the rebel movement based in Benghazi as Libya 's rightful government on July 15 at an international meeting on Libya in Istanbul . The move , done in coordination with the international community , paves the way for the United States to reopen the embassy , accredit diplomats and unfreeze billions of dollars in frozen assets . The internal strife within the rebel movement comes as the State Department prepares to hand over the Libyan embassy to the TNC as the recognized government of Libya , according to U.S. officials . The officials say the move would allow the TNC to re-open the embassy , accredit diplomats and regain control of the embassy 's frozen bank account , worth about $ 13 million . It follows a formal request from the TNC to re-open the embassy under its control and accredit Ali Aujali , the former Libyan ambassador to the United States , as its charge d'affaires . In March , the State Department ordered the Libyan embassy in Washington closed and kicked diplomats loyal to Libyan leader Moammar Gadhafi out of the country . Aujali had resigned his post as the regime 's ambassador to the United States in February and has since represented the opposition in Washington . `` We are consulting with the National Transitional Council on a broad range of issues , and that includes diplomatic accreditation and representation , '' Toner said . Despite the divisions within the TNC , the State Department publicly expressed confidence in the rebels . `` We believe that this is the legitimate representatives of the Libyan people during this transition period , '' Toner said . `` This is an extremely challenging period for Libya and they are dealing with these challenges as they come . But we have confidence that they can weather this . '' But privately , U.S. officials acknowledge there is some concern about the apparent disarray within the rebel movement , although officials say it is not surprising . `` This is a tribal society , '' one official said . `` We knew from the start this could be messy and there was always the concern about not moving too fast . We had no illusions about the TNC , but they have done a pretty good job and look better to us than Gadhafi at this point . '' NATO has been bombing Libya for more than four months under a U.N. mandate to protect civilians from troops loyal to Gadhafi , who is battling a rebellion that has claimed control of the eastern half of the country . The U.S. Embassy in Tripoli was shuttered and American personnel evacuated by sea and air in late February , after the current revolt against Gadhafi erupted . Libyan and U.S. officials held face-to-face talks in Tunisia last month , but Washington says the sole point of the meeting was to repeat its demand that Gadhafi `` must go . '' Also Sunday , state TV aired video of Saif al-Islam Gadhafi , Gadhafi 's son , speaking to what was described as displaced families . He has not been seen speaking in public for weeks . `` Whether NATO stays or not , the battle will continue until Libya is freed , '' he said , stressing the right of people to fight . `` Let me say to you that the battle will not stop . Every one of you : return to your homes and farms and villages and jobs with peace of mind . We will not stop ! ''
NEW : Gadhafi 's son : `` Whether NATO stays or not is a question of time. The Transitional National Council has been rocked by internal divisions . Last week the TNC 's military commander was mysteriously assassinated .