Residents at Mahuru village, Port Moresby, alleged that the men were drinking together when a fight started, which eventually led to the death of a Southern Highlander.
In retaliation, a group of Southern Highlanders mobilised and started breaking into homes from the centre of Mahuru village.
A number of distraught women and children ran to seek refuge at the nearby Air Niugini village.
Movements in out of the Air Niugini residency were stopped till the fight died down at around 9:20am.
Though most of the villagers have returned to their homes, tension is still high as residents fear the perpetrators may return.
Police have confirmed one death with Loop PNG, while details into the situation will be released as soon as possible.
(Muhuru villagers seeking refuge at Air Niugini village this morning)