The bodies of the dead, 25 gunmen and six civilians hit by stray bullets as they were going to morning prayers on Tuesday, littered the streets of the town, witnesses said.
Nearly 18 people who sustained serious gunshot wounds were rushed to nearby hospitals while a dozen others were seen seeking treatment in local pharmacies.
The clashes erupted after about 200 fighters from a breakaway group of the Somali National Front (SNF) faction attempted to retake the town from a rival SNF faction.
"Fifteen of the dead were attacking militia, 10 were the ones who were defending the town, and six are ordinary civilians caught by stray bullets," said a witness who did not want to be named.
Residents began burying their dead in line with the Muslim practice of doing so on the day death occurs.
A source in the defending SNF faction said they had killed one of the attackers' commanders and captured two pick-up trucks mounted with machine guns.
He added he thought the attackers had fled across the Kenyan border.
Bulohawo businessman Ahmad Yasin said: "The fighting, early today [Tuesday], is a continuation of earlier clashes between two rival groups in SNF." The SNF is dominated by the Marehan clan.
Another Bulohawo resident, who did not want to be named, said the fighting had subsided after the attackers were repelled.
The SNF, which controls Gedo region and parts of central Somalia, has been divided mainly by a struggle for its leadership since 1996.
Somalia descended into anarchic bloodletting in 1991 when dictator Muhammad Siad Barri was toppled. Since then the country in the Horn of Africa has been divided into fiefdoms governed by unruly regional commanders.