Tens of thousands of Quechua and Aymara indigenous Indians, miners, students, farmers and other labourers descended on La Paz demanding the nationalisation of the natural gas industry and more wealth for the poor and indigenous majority.
Riot police firing tear gas canisters sent thousands of demonstrators fleeing, while miners in brown hard hats responded by blasting dynamite sticks.
An estimated 80,000 protesters paralysed the city and prevented the Bolivian Congress from meeting to choose a successor to Mr Mesa, who resigned amid protests on Monday.
If Congress accepts his resignation, it could call for new elections, raising the prospect of Bolivia becoming the seventh Latin American country to move to a leftist government.
The US-backed Mr Mesa served as president for 20 months after his predecessor Gonzalo Sanchez de Lozada was also driven from office by protests over Bolivia’s gas reserves.
Leftist opposition chief Evo Morales, a leader of Bolivia’s coca growers, called for a presidential election by the end of the year.
The demonstrators have voiced opposition to Senate leader and Vice President Hormando Vaca Diez becoming the country’s new leader.
Mr Diez should become interim president, but if he does not, the head of the Chamber of Deputies, Mario Cossio, and the head of the Supreme Court, Eduardo Rodriguez, are next in line.
The successor would serve out the remainder of Sanchez de Lozada’s term until August 2007.
After weeks of protests, fuel, food and other essentials were in short supply in La Paz. Public transport has been virtually shut down.
Unrest has been simmering since Bolivia’s Congress last month raised taxes on foreign oil companies developing Bolivia’s natural gas reserves.
The move sparked demands for the nationalisation of the energy industry and for a new constitution giving more clout to the indigenous Indians, who represent more than half the population.
The United States, meanwhile, urged Bolivians to respect the country’s laws and constitution. The State Department has warned Americans not to travel to Bolivia.
Bolivia, South America’s poorest country, has the second-largest gas reserves in South America, after Venezuela.