Thursday's protests were generally peaceful but dozens of demonstrators set fire to toll booths on the main highway linking El Alto to neighboring La Paz, Bolivia's administrative capital. The protesters hurled sticks and stones at police, who used tear gas to clear the area.

Bus and truck drivers protested by blocking roads and public transportation was crippled in La Paz.

Morales, a close ally of fiery Venezuelan President Hugo Chavez, enjoys solid support among Bolivia's poor indigenous majority but the rise in fuel price has angered his leftist base and trade unions have led demands for the increase to be reversed.

Morales, who announced wage increases on Wednesday in an apparent attempt to calm protests over the so-called "gasolinazo" measure, defended the price hikes again on Thursday as a vital tool to cut imports and spur lagging investment in oil output.

"This is the end of a neoliberal subsidy that caused corruption," Morales told a news conference, referring to the brisk trade in smuggling cheap Bolivian fuel to Peru.

The end of the fuel subsidies is expected to save the state about $380 million each year -- equivalent to about 2 percent of gross domestic product.