Muslim groups began protesting in the streets of Birgunj on Sunday against the vandalism of a mosque in a nearby town.
A curfew was imposed on a key border city in Nepal after protests between Hindu and Muslim groups following the vandalism of a mosque at the weekend, officials said on Tuesday.
The curfew orders issued by the Parsa District Administration said that no one will be allowed in the streets of the southern city of Birgunj and all gatherings and demonstrations are banned.
The notice also warned that violators could be shot by security forces.
Armed soldiers and police officers were Birgunj, located 130 kilometres south of the capital Kathmandu, which is the key border point for importing much of the oil, goods and supplies from neighbouring India.
Muslim groups began protesting in the streets of Birgunj on Sunday against the vandalism of a mosque in a nearby town, which was followed by a separate demonstration by Hindu followers on the same day.
Protests have continued since.
There have been no major clashes between the two groups and no major injuries, with only scuffles with riot police reported.
Clashes between Hindus and Muslims are rare in the predominately Hindu nation of Nepal, where the Muslim population is found mostly in border regions in the southern part of the country.