As a group of some 20 rightwing activists arrived in Umm al-Fahm, Arab youths with scarves wrapped around their faces burned tyres and hurled stones at police clad in riot gear, who fired tear gas and stun grenades to disperse them.
"Free Palestine!" Arab residents waving Palestinian flags shouted from rooftops. "With our blood, with our souls, we sacrifice for you, Palestine!"
The controversial march roughly coincides with the 20th anniversary of the assassination of Rabbi Meir Kahane, a rightwing extremist who routinely referred to Arabs as "dogs" and called for their expulsion from Israel.
"The Islamic Movement is part of the international Islamic jihad," said Michael Ben Ari, a rightwing lawmaker who took part in the protest, accusing it of having ties to the Palestinian militant groups Hamas and Islamic Jihad.
Ahead of the march, local Arab officials and dozens of counter-protesters waving Palestinian flags gathered in the town, AFP correspondents said, as police deployed in force to prevent clashes.
"We have deployed large numbers in the vicinity of Umm al-Fahm and mobilised special units to maintain calm during a demonstration by Jewish activists," police spokesman Micky Rosenfeld told AFP.
Israel's Supreme Court earlier this month gave permission for the demonstration.
Afu Agbaria, an Arab parliamentarian from Umm al-Fahm who joined other officials in protesting the march, called it a "provocation against the people of Umm al-Fahm and the Arab minority in the country."
"They are attacking the legitimacy of the Arab presence in the country in coordination with the rightwing extremists in the government," he said.
Others were more blunt.
"We will not allow them to enter Umm al-Fahm. If they pass, it will be over our dead bodies," Ahmad Buwerat, 75, said ahead of the march.
"We have Jews come here every day to visit the market and drink coffee, and they are welcome. But these demonstrators are fascists and racists and Nazis," he added.
Kahane, an American-born rabbi and political leader, was shot dead by an Arab gunman in Manhattan in November 1990, and his Kach movement was outlawed by Israel in 1994 for inciting racism.
Israeli Arab political leaders fear, however, that his controversial ideas are gaining new currency under Israel's rightwing-dominated government.
Earlier this month Israeli Prime Minister Benjamin Netanyahu lent his support for a bill that would require all new citizens to swear allegiance to Israel as a "Jewish and democratic state."
Arab citizens, who makes up 20 percent of the population, have called the bill racist and said it aims to delegitimise their presence.
Israel's 1.3 million Arab citizens are Palestinians who remained in the country following the creation of the Jewish state in 1948 and their descendants.
Source: AFP Global Edition