At least 20 armed gang members have died in clashes with police in Mexico's western Michoacan state, officials say.
Two police officers were also killed in shootouts that started after gang members blocked roads with vehicles and ambushed police patrols.
The attacks came a day after members of the Knights Templar drug gang shot dead five demonstrators protesting against the cartel's violent tactics.
Michoacan has seen a steep rise in violence in recent months.
In May, President Enrique Pena Nieto sent in a general to take over police and military operations in the western state.
Self-defence vigilante groups have formed in several towns in the region vowing to fight the violence, kidnappings and extortion carried out by drug cartels.
StrangleholdHundreds of people demonstrated in the town of Los Reyes on Monday, holding up placards opposing the Knights Templar drug gang and the extortion rackets it runs in the area.
- First emerged in 2011 as an off-shoot of La Familia Michoacana drug cartel
- Takes its name from a Christian military order from the Middle Ages
- Claims to protect Michoacan residents from kidnappings, extortion and robberies committed by rival gangs
- Members say they abide by a code of honour which includes not drinking or taking drugs and not abusing family members
- Often uses pseudo-religious language to justify acts of violence
- Controls much of the methamphetamine and marijuana trade in western Mexico
- Cartel members have been accused of murders, kidnappings and extortion
- Operates mainly in western Michoacan state
- At war with Zetas cartel and Jalisco Nueva Generacion drugs gang
Armed men believed to belong to the cartel opened fire on the demonstrators, killing five and injuring at least eight.
The BBC's Will Grant in Mexico City says the Knights Templar seems to have strengthened their stranglehold on some parts of the region.
Our correspondent says their rise may be behind a spate of violent clashes with a rival criminal gang from the neighbouring state of Jalisco, called Nueva Generacion (New Generation), as well as constant battles with the security forces.
The latest clashes came after gunmen blocked several roads and bridges by setting trucks on fire.
They then ambushed police arriving at the scene.
The interior ministry said 20 armed men were killed. Two police officers died in the clashes and 15 were injured.
It is not yet clear which gang was behind Tuesday's attack, but the authorities say the ambushes had been well-planned and the gunmen were armed with high-powered weapons.
Earlier this month, Mexican marines captured one of the world's most notorious drug bosses.
Miguel Angel Trevino Morales was the leader of the Zetas, considered the most violent of Mexico's cartels.
Trevino Morales is the highest-profile arrest since President Pena Nieto took office last December, promising a stricter clamp down on cartels through law enforcement at a local level.
Some 60,000 people have died across Mexico since 2006 when the previous government under Felipe Calderon deployed the military against the drugs gangs.
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