The military earlier said it had taken back control of five central Bangkok districts that were overrun by demonstrators. Troops used gunfire and tear gas to force the crowds to retreat to their main camp outside the government building.
Road blocks have been set up around the building to control the movement of the "red-shirt" protesters.
Exiled former Prime Minister Thaksin Shinawatra, whose supporters have been rallying against the government, said several protesters had been killed in the crackdown.
"Many people are dying ... They even take the bodies on the military trucks and take them away," he told CNN.
The government said one local resident was killed in a clash with rioters.
The unrest has dealt a heavy blow to the country, still reeling from the global financial crisis and last year's political turmoil.
The Thai Emergency Medical Institute said 94 people including soldiers were injured in Monday's clashes.
Protests in Thailand started in March after the government allocated 9 million low-paid Thai workers assistance worth $55 each to stimulate the economy. Protesters called the aid "bribery," accusing the cabinet of coming to power illegally and demanding that Prime Minister Abhisit Vejjajiva step down.
Demonstrators, who are wearing red t-shirts, have set tires on fire in front of the Bank of Bangkok headquarters and thrown Molotov cocktails at government buildings.
Rescuers said at least five protesters suffered severe tear gas injuries in the police crackdown. The opposition says that some of its members have also suffered gunshot wounds, according to the Nation newspaper.
Protesters forced a cancelation of the summit of the Association of Southeast Asian Nations in Thailand's resort of Pattaya on Friday. Activists descended on the venue, forcing Vejjajiva to declare a state of emergency.
The 14th meeting of ASEAN leaders, which has already been postponed twice, is now due to go ahead in August.
