Many migrant workers compete with Algerians for work in the building trade
About 100 local residents and Chinese migrant workers have clashed in the Algerian capital, some brandishing knives and rods, reports say.
Ten Chinese migrants were injured and two Chinese shops looted, Reuters reported, citing a Chinese diplomat.
Violence flared after a confrontation between a shop owner and a migrant in the city's Bab Ezzouar district.
High unemployment among young Algerians has fuelled tensions over migrant workers who accept lower pay.
A shopkeeper told Reuters that the fight broke out after a disagreement with a Chinese migrant worker.
"I told him not to park his car in front of my shop, but he insulted me," 31-year-old Abdelkrim Salouda said.
"I punched him, I thought it was over, but after 30 minutes he came back with at least 50 Chinese to take revenge. It is a miracle I am still alive."
Firms in Africa's third largest economy say that they depend on Chinese labour - often better qualified and willing to accept lower wages than Algerian workers - to staff the construction sector.
Official estimates put the number of Chinese migrant workers living in Algeria at 35,000.
Some 8,000 work in the building sector in Algeria, according to Agence France Presse, and in the Bab Ezzouar district alone Chinese firms have built dozens of structures.
A diplomat at the Chinese embassy said he hoped Algerian authorities would look into the fighting but added that it would not affect relations between the two countries.
"Our friendship with Algeria is strong and this event is nothing in comparison with the links between our two countries," Ling Jun said.