More than 20,000 people attended a rally organized by the Socialist party to demand that conservative Prime Minister Sali Berisha call early elections after revelations of alleged corruption.
The clashes involving riot police and hundreds of pro-opposition protesters have also left 22 civilians and 17 policemen and national guard officers hurt, according to authorities.
The violence follows months of tension between the government and opposition Socialists that was rekindled this week after Prime Minister Berisha's deputy resigned over allegations of bribery in a power plant tender.
Albania, a new member of NATO, is eager to show an improvement in its election standards and democratic institutions to gain eventual European Union membership.
Socialist leader Edi Rama urged supporters to rally peacefully, and organizers of Friday's rally said they were trying to restrain the crowd.
The U.S. Embassy has also called for the protest to be peaceful and called on politicians, too, to tone down their inflammatory rhetoric.
Police said seven officers were hospitalized following the clashes in the city center. Hundreds of people smashed paving stones and threw them at riot police. Nearby, three cars and a police van were set afire.
Police responded with tear gas, plastic bullets and water canon before falling back, allowing several hundred protesters to gather at the entrance to the main government building.
The Socialists have accused Mr. Berisha's conservative Democratic Party of rigging the 2009 general election, which it won by a narrow margin. The next general election is not scheduled until 2013.