Villagers rallied in the southern coastal district of Noakhali to demand a halt to construction of a local Hizbut Tauhid mosque, executive magistrate M Nikaruzzaman told AFP.
"As the clashes spread, some 5,000 villagers attacked hundreds of followers of Hizbut Tauhid with sticks and rocks. Two people were killed and some 60 people were injured. The villagers also torched two homes of Hizbut Tauhid members," he said.
Hundreds of police and paramilitary officers sent to the scene fired rubber bullets and tear gas at the rampaging villagers to try to halt the violence, police said.
But the government has banned one of HT's books, which had enraging mainstream groups by calling on Muslims to shun conventional forms of Islam.
In recent years, police have arrested hundreds of HT members for holding closed-door meetings which they considered suspicious, as Bangladesh reels from rising Islamist violence.
However the group, whom many mainstream Muslims call deviant, says it rejects all forms of violence.