The demonstrators demanded further compensation for being uprooted five years ago to make way for the colliery.
The Brazilian corporation Vale insisted it had already done enough, paying out about $2,000 (£1,300) per person.
But campaigners said they should receive more for the loss of the community’s brick-making industry.
The protest first broke out on Tuesday after more than a year of negotiations between the company and the protesters, who were resettled in 2008 to make room for the Moatize mine.
Vale moved about 5,000 people in order to set up its mining operation in the coal-rich north western province of Tete.
“When Vale came to Mozambique the government told us, you will get very rich. That is why we want the company to pay us what it owes us,” one of the protesters, Maxwell April, told AFP.
Vale said the demonstration had not affected production and that it respected the demonstrators’ rights to protest peacefully.
A government spokeswoman said the matter of compensation had already been settled.