The Ethiopian government says 10,000 people have fled from the western region of Gambella, after nearly 200 people were killed at the end of January.
The government says the killings took place when member of the Anyuak ethnic group attacked traditional gold miners.
Burnt villages are being rebuilt after last year's clashes
But it now appears that the fighting has deeper roots - with a rebellion brewing in this remote region, close to the Sudanese border.
Tension in the Gambella region has been simmering for years.
Aid agencies say the Anyuak people feel they have been gradually displaced from their traditional lands.
The problem began in the 1980s - when the previous government used forced resettlement to bring about 50,000 people from Ethiopia's exhausted central highlands to the fertile, but swampy, malaria- infested Gambella.
Pressure increased as thousands of ethnic Nuer sought shelter in the region to escape from the Sudanese civil war.
Oil and goal
After the current government came to power in 1991 it ruled the area through local parties, but real power was still in the hands of the highlanders.
Last year the authorities sacked a number of Anyuak, including some policemen.
They are reported to have taken their weapons and gone into the bush, carrying out sporadic attacks.
One clash last December resulted in highlanders turning on the Anyuak - in clashes that left as many as 300 people dead.
The latest attack on the miners is seen in this context.
Anyuak rebels are now determined to hit any economic interests that could provide support to the central authorities.
Oil has been found in the area, and the Malaysian company, Petronas has exploration rights in Gambella.
The suggestion is that by attacking the gold mines, the Anyuak rebels will undermine attempts by the Ethiopian authorities to make economic gains in the area.
But it is difficult to know exactly what took place, as Gambella is isolated and communications are poor.
The United Nations is attempting to put together a team to report on the circumstances of the latest fighting.