Tensions were running high throughout the day as the clashes broke out in the southern town of Janakpur, over 225 kms from here and home to the famous Ram Janaki temple.
Around 45 security personnel and 55 cadres of Madhesi Morcha were injured in the stand-off, the Kathmandu Post reported.
Madhesis, largely of Indian-origin, are agitating over the new Constitution demanding more representation. They are also protesting division of their ancestral homeland under the seven-province structure and have led an ongoing blockade of key border trade points with India.
The protesters hurled 21 Molotov cocktail (petrol bomb) at police, it quoted Chief District Officer Kali Prasad Adhikari as saying.
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Security personnel also fired 21 rounds of teargas shells, Adhikari added.
Madhesis have resorted to aggressive protests after Rajendra Mahato, a prominent leader of the Morcha and Chairman of Sadbhawana Party, sustained injuries in a clash between police and Morcha cadres in Biratnagar border on Saturday.
Schools and colleges have remained closed for three consecutive days. Business activities and market places have also come to a complete halt.
Meanwhile, Sadbhawana Party's Dhanusa Chairman Sanjay Kumar Singh accused government administration of using undue force at protesters.
On December 16, Nepal's first woman President, 54-year- old Bidya Devi Bhandari, escaped unhurt as agitating Madhesis waving black flags attacked her motorcade with stones and hurled a petrol bomb at the Ram Janaki temple that she had visited.