A MOB suspected to be made up of supporters of Nicaraguan President Daniel Ortega attacked a protest by senior citizens over pension payouts, drawing outrage from political, business and religious groups.
About 300 people wearing printed government t-shirts and their faces masked by scarves "suddenly appeared, running and shouting they would kill us," said Luciana Chamorro, who was at the scene of the violence in Managua on Saturday.
"They were beating up some old men with bats and kicking them," said Chamorro, one of a group of college students on hand to support the elderly protesters.
Chamorro, grand-daughter of former president Violeta Barrios de Chamorro, said the mob was trucked in to the area.
She said men were stripped naked, bags and mobile phones were grabbed, and the protesters were given just seconds to "disappear" from the square that has been occupied for a week for the demonstration.
The attackers, both men and women, destroyed the makeshift camp and smashed the windows of nearby cars, she said, adding that police "laughed" and blocked demonstrators from running away.
The violence was condemned by opposition politicians, business groups and Catholic leaders, who accused the government of using "paramilitary groups" against the elderly in a move he called "state terrorism."
Protesters are calling for the government to pay out partial pensions to elderly Nicaraguans who have paid into the social security system for at least five years, but who did not work the 750 weeks, or just under 14.5 years, required to earn a pension.
The president of the social security administration said on Friday the agency does not have the money to pay reduced pensions, which would amount to about $US95 million ($A103.6 million) annually.