Unrest began when state health officials went to inspect factory in Prato, hub of textile production where many migrants work
Violent clashes have broken out this week between police and the local Chinese community in Prato near Florence, home to one of the largest concentrations of Chinese-run industry in Europe.
Tensions had been rising in the town, Italys textile capital, that has attracted Chinese immigrants since the mid-1990s. Some 50,000 Chinese work in the area, making clothes and handbags with the prized Made in Italy label.
Some of the firms are accused of using illegal migrant labour, ignoring safety rules and evading taxes. The area is also the focus of an investigation into allegations of money smuggling worth 4.5bn (3.8bn) to China from Italy between 2006 and 2010.
The trouble started on Wednesday when state health officials, who stepped up checks after seven people died in a fire at a garment workshop in 2013, went to inspect a factory.
The owner reacted angrily when an inspector raised minor violations of health and safety rules, shoving the inspector and the police who were accompanying him, according to a police source.
Chinese workers then barricaded themselves inside the factory, and hundreds more gathered outside, throwing stones and bottles at the police carrying truncheons and shields who went in to disperse the crowd. Two Chinese citizens and a policeman were injured.
Regional president Enrico Rossi said on Friday that he had discussed the incident with foreign minister Paolo Gentiloni.
Rossi vowed to tackle crime in the area, where he said half of all economic activity is illegal, 1bn in taxes go unpaid every year, and money is laundered through international transfers.
The situation is unacceptable, Rossi told Reuters. We need the Chinese community to respect the law and integrate, we cannot have free zones. We will keep up inspections to clean up this immense production system.
Chinese officials in Florence went to the site of the clashes and Chinese foreign finistry spokesman Hong Lei told a news conference on Friday that the situation was under control.
China had asked Italy to enforce the law in a civilised way, conduct fair investigation and protect the security and lawful rights and interests of Chinese citizens in Italy.
Hong also advised Chinese people in Italy to defend their rights and interests in a law-abiding and rational way, his ministry said on its website.
In the aftermath of the clash, the factory owner and a worker were arrested on suspicion of causing injury and resisting public officials.
Protesters gathered outside the court that confirmed the arrest order, saying public officials used excessive force when inspecting the factories.
We want justice, said a protester who gave his name only as Luca, and said his parents had come from China.