Thousands of Chinese villagers are reported to have clashed with riot police in the southern province of Guangdong after blockading officials inside a warehouse they say was built on illegally seized land.

As many as 10,000 people from the village of Sanzhou near the affluent city of Shunde blockaded the newly built granary during the building's official opening on Wednesday, said Hong Kong's Apple Daily newspaper.

The villagers prevented dozens of local officials and foreign business people from leaving the warehouse, which they say was built on land seized illegally and sold off to developers.

The newspaper said 300 dignitaries, including local leaders and Hong Kong and foreign business people, were trapped inside.

The crowd shouted, "We want money for our land," reported Radio Free Asia.

The villagers stood their ground against 1,000 riot police, but dispersed when tear gas was used Thursday morning, the report said.

Ten people were arrested, according to the newspaper.

Gap between rich and poor

The incident highlights the increasingly large gap between China's haves and have-nots.

As China's economy has grown in recent years, Chinese leaders have been struggling to cope with an increasing number of public disturbances and social unrest sparked by land-grabs, corruption, unpaid wages and environmental pollution.

In January, China's public security ministry said there were 87,000 such incidents in 2005, up 6.6 per cent from the previous year.