The Indonesian military said troops opened fire when rioters attempted to break into a Christian university in Ambon city.
The city has been the scene of a number of clashes between Muslims and Christians in recent months.
An Indonesian military commander said his men had earlier fired blanks to deter the crowd from moving forward.
Both Muslims and Christians have in the past accused the security forces of taking sides in the conflict, which has claimed more than 400 lives.
There were reports that approximately 25 people had been injured in the violence in the eastern Indonesian city, some 2,300 km (1,440 miles) east of Jakarta.
Call for holy war
Lieutenant Colonel Ivsan Art, the commander of a marine battalion sent to reinforce the local police, said his men opened fire to prevent the mob from breaking into a Christian neighbourhood, according to the Associated Press.
"We shot at the Muslims because it was they who were crossing the (inter-communal boundary) line," he was quoted as saying.
Ambon residents said the violence came after mosques had called for an Islamic Jihad, or holy war, against Christians.
The residents told the AFP news agency that the call was relayed by loudspeakers from mosques in the Diponegoro, Jembatan Pohon Pule and Batumerah areas.
'Shoot on sight'
The animosity between Muslims and Christians burst into the open early this year.
Last month military commanders issued a "shoot on sight" order to troops faced with rioters. More troops were drafted in to serve on the troubled island earlier this month.
Approximately 100 people have died in violence in the last month. Tens of thousands of others have fled to other provinces and there has been widespread destruction.
Country profiles
'Massacre' in Ambon church
(12 Aug 99 | Asia-Pacific)
More troops to quell Ambon violence
(12 Aug 99 | Asia-Pacific)
Rioters killed in fresh Ambon street battle
(10 Aug 99 | Asia-Pacific)
Military cracks down on Ambon rioters
(29 Jul 99 | Asia-Pacific)
Ambon's troubled history
(09 Mar 99 | SPECIAL REPORT)
Analysis: Indonesia's religious tensions
(24 Feb 99 | SPECIAL REPORT)
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Indonesian Government
Antara News Agency
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