"Security forces used their batons and took away protesters in three army buses," one witness, who did not want to be identified, told Reuters by telephone.
The violent clashes between security forces and protesters continued until the early hours of Saturday.
Security forces had on Thursday fired shots in the air to push out protesters camped outside the provincial governor's office, destroying their tents and arresting dozens and possibly hundreds. Fresh clashes in Salalah erupted again on Friday.
"The security forces are still there this Saturday morning to make sure no protester comes back. But we hear that most of the people arrested on Thursday have been released," another witness said.
Protesters have focused on demands for more jobs, better wages and an end to graft. They have also urged more democratic reforms in the conservative sultanate.
Sultan Qaboos bin Said, a U.S. ally who has ruled Oman for 40 years, promised a $2.6 billion spending package in April after nearly two months of demonstrations inspired by popular Arab uprisings across the Arab world.
Many protesters have been unsatisfied with Sultan Qaboos' response to their demands, saying the changes have been partial or too slow.
Earlier this week, Omani police arrested six people involved in a demonstration demanding jobs and higher wages in the eastern town of Jaalan Bani Bu Ali.