Police in Athens fired tear gas to disperse demonstrators hurling stones and petrol bombs, with a 24-hour nationwide strike bringing much of the country to a standstill.
Government offices and many schools remained closed on Wednesday afternoon, with the union-organised strike also causing major disruption to public transport and hospital services.
More than 100 flights were cancelled, as clouds of smoke from the riots choked the capital city, while a journalist walkout from state and private television and radio stations resulted in a partial media blackout.
The major protests are the first of their kind this year after Greece's Socialist Pasok administration was forced to call in a €110 billion EU-IMF bail-out last May.
"I am demonstrating because the government has to fix this mess that it has gotten into," hairdresser Doria Tsirigoti told the DPA German press agency as she pulled the shutters down on her salon to avoid damage. "There are politicians which have robbed the country blind yet no one has been brought to justice."
Government spending cuts and tax hikes linked to the EU-IMF support package have proved highly contentious with many Greek citizens.
Speaking at the protests, deputy leader of Greece' large GSEE union, Stathis Anestis, dubbed the government measures "harsh and unfair".
"We are facing long-term austerity, with high unemployment and destabilising our social structure," he told the Associated Press news agency. "What is increasing is the level of anger and desperation ... If these harsh policies continue, so will we."
A day earlier, German Chancellor Angela Merkel indicated that the repayment period for Greece's international loan could be extended.
The latest clashes come as EU leaders prepare to meet next month in various formats to discuss an overhaul of the bloc's emergency lending fund and budgetary rules.
A Franco-German 'Pack for Competitiveness' is also on the agenda, with the package of proposals meeting a frosty reception at a European Summit earlier this month.
The eurozone's second EU-IMF bail-out recipient, Ireland, is set for national elections this Friday, with the ruling popular Fianna Fail party headed for a humiliating defeat of historic proportions.
Anger over the bail-out lending terms has been a central element during recent election campaigning, with the front-runner centre-right Fine Gael party repeatedly stating its desire to see loan interest rates reduced.
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