The clash took place on Sunday in a gold mine near the village of Coroico, 100 kilometers (60 miles) from the capital La Paz.
Forty local residents, Bolivians and Peruvians, broke into a mine to remove members of a cooperative that had been working there.
"Unfortunately one person died, and the first indications are that firearms were used," Deputy Interior Minister Marcelo Elio told AFP.
He said that dynamite was also used in the clash and that 200 policemen had been deployed to the scene to restore peace.
A police officer died while trying to evict independent miners from a mine being operated by a cooperative in August.
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