Police issued arrest warrants for seven people including two monks -- among dozens of hardliners who stormed into Mingalar Taung Nyunt township hunting for "illegal" Rohingya Muslims.
Officers fired warning shots to break up the scuffles in the early hours of Wednesday.
The incident comes as nationalists from Myanmar's Buddhist majority have become increasingly vocal in their opposition to the country's hard-pressed Muslims.
The Rohingya, a group of more than a million Muslims who live mainly in western Rakhine State, are particularly maligned as illegal immigrants from Bangladesh and their movements are heavily restricted.
At least two people have been arrested out of seven who have been charged with incitement to commit violence, which carries a sentence of up to two years in prison.
''About three lay men were arrested by police this evening," a local police officer told AFP on condition of anonymity.
"Warrants have been issued to arrest seven people altogether, including two monks, U Thu Seitta and U Pyin Nyar Wuntha," he added, using an honorific.
However, local media reported that two people had been arrested.
Tensions have boiled over since militants attacked police posts in northern Rakhine, sparking a brutal army crackdown that has sent more than 70,000 people fleeing to Bangladesh.
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