ATHENS: Greek lawmakers approved a new round of drastic austerity measures late Sunday after a long day of street battles between police and protesters left Athens buildings ablaze and the streets in chaos.

The deputies defied the 100,000-strong turnout in Athens and Thessaloniki and approved another round of stringent budget measures requested by Greece's international creditors in return for a multi-billion rescue fund.

Greek Prime Minister Lucas Papademos denounced the violence in the debate leading up to the vote, saying the street battles around the parliament building had no place in a democracy.

Deputies "will assume their responsibility" and make the most important choice of "advancing with Europe and the single currency", Papademos said shortly before the vote took place.

The fire brigade said 10 buildings were set ablaze in central Athens, most of them by petrol bombs hurled by masked protesters who have been a common presence at anti-austerity marches since the crisis began in 2010.

The health ministry said 54 people were injured in the day's events.

Fire engines were initially unable to intervene because of the size of the protest and the chaos that filled the streets around the parliament building, where lawmakers debated the austerity plan ahead of a late-night vote.

When protesters wearing gas masks tried to break through the riot police cordon around parliament, the standoff broke out into running battles, with tear gas canisters and rocks flying in opposite directions.

An estimated 80,000 protesters gathered in Athens, police said, matching the biggest turnouts achieved against earlier austerity packages last year, while around 20,000 also demonstrated in the second city of Thessaloniki.

Finance Minister Evangelos Venizelos told parliament it had to back the government-approved plan to unlock a 130 billion euro ($171 billion) rescue fund from the EU and the IMF, or Greece would be forced to default.

"The situation is very clear. Tonight at midnight before the markets open the Greek parliament must send the message that our nation can and will (support the debt deal)," Venizelos said.

The pressure on Greece is huge as leaders in the eurozone core countries express their exasperation with Athens and increasingly minimise the wider dangers of the country stumbling out of the single currency.

The proposed measures are expected to heap more hardship on ordinary Greeks already suffering from the crisis.

They involve a 22-percent cut in the minimum wage (32 percent for workers under 25); deregulating the labour market to make it easier to lay off workers; and a package of tax and pension reforms.

Sunday's protesters included trade unionists, youths with shaven heads waving Greek flags, communist activists and left-wing sympathisers, many of them equipped with gas masks.

Many families also joined in the rally, although the square was quickly cleared after the first round of tear gas was fired, before filling up again.

They denounced what they describe as blackmail being imposed by the international troika of the EU, the IMF and the European Central Bank in return for the bailout. (AFP)