Over a thousand of people, from war veterans to students, waved banners saying "China don't steal our oil" and "Silence is cowardly" opposite the Chinese embassy, the Guardian reports.
The dispute escalated after Vietnamese ships clashed with Chinese vessels guarding an oil rig in a controversial area of the South China Sea.
Vietnamese police set up barricades to prevent protesters approaching the embassy compound but made no move to break up the rowdy demonstration.
Large anti-China protests were also seen in other Vietnamese cities, BBC reports.
Dozens of anti-China demonstrations have been held in Vietnam since 2007.
Earlier this month, ships from the two countries collided near a Chinese oil drilling platform in the South China Sea.
China has warned Vietnam to withdraw its ships from waters, off the disputed Paracel Islands, that it considers Chinese territory.
At the same time, Vietnam accused China of having sent 80 vessels, including navy ships, to support an oil drilling operation.
This issue was one of the central topics of discussion by foreign ministers at the ASEAN summit of south-east Asian Nations in Myanmar last weekend.
ASEAN foreign ministers expressed "serious concerns over the ongoing developments" in a joint statement released on Saturday.
Sea row dominates ASEAN summit
Southeast Asian leaders met Sunday for a historic summit in former pariah Myanmar overshadowed by soaring tensions in the South China Sea.
The 10-member Association of Southeast Asian Nations (ASEAN) is convening just days after both Vietnam and the Philippines locked horns with China in contested waters, stoking international alarm.
The summit, hosted for the first time by Myanmar in its showpiece capital Naypyidaw, is set to be dominated by discussion of the South China Sea, which is crisscrossed by key shipping lanes and thought to contain vast energy reserves, AFP reports.
In his opening address, Myanmar President Thein Sein said "regional and global issues of great concern to ASEAN will be extensively discussed among ourselves", without directly mentioning the escalating maritime crisis.
ASEAN foreign ministers expressed "serious concerns over the on-going developments" in a joint statement released Saturday as the bloc sought to present a unified front in dealing with the region's massive neighbor.
Tensions flared this week after Beijing controversially relocated a deep-water oil rig into territory also claimed by Hanoi.
The area around the drilling well has since seen several collisions between Chinese and Vietnamese ships, with the communist neighbors each blaming the other for the rise in tensions.
http://www.information.myanmaronlinecentre.com/largest-ever-anti-china-protests-take-place-in-vietnam-over-sea-dispute/
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