Residents said the rioters clashed with security forces on Sunday in the coastal town of Zeralda, around 35km west of the capital, Algiers, looting and burning a state bank.
Several protesters and riot police were injured in the clashes which followed the death of the man at a police station.
Few details were available about the circumstances of the death of the young man and government officials were not immediately available for comment.
El Watan newspaper quoted one resident as saying that police killed a local 34 year-old man after an argument with a police officer over the man's girlfriend.
Police used tear gas to disperse the angry rioters who set fire to a bank after looting it. The rioters threw stones at police and attempted to attack more public buildings.
Algeria sees sporadic riots to protest social problems, including acute housing shortage and unemployment.
The government says it is investing $80 billion over the next five years to improve standards of living, boost growth and modernise infrastructures.