Witnesses said a convoy of vehicles sped by and opened fire in the early hours of Tuesday morning. The man was bleeding heavily and was driven to a hospital, where he later died, according to Lizbeth Cana, the state prosecutor.
Around 10 bullet shells lay on the ground at the scene of the attack.
He was the fifth fatal victim of violence that has paralysed this cty popular with foreign tourists.
The unrest began with a teachers' strike over pay but has since escalated with students and left-wing radicals joining the protests and seizing control of several radio stations as well as the state government-run television channel.
Activists erected street blockades and set fire to public transport buses on Monday, demanding the resignation of Ulises Ruiz, the state governor, for his handling of the strike.
The violence has raised tension just as Mexico is split over claims of fraud at the presidential election in July, won narrowly by conservative Felipe Calderon.
Ruben Aguilar, the president's spokesman, said Vicente Fox's government is worried about the disturbances in Oaxaca but says it is an issue mostly for the local state government.
"The presidency acknowledges ... there is a serious problem in the case of Oaxaca, a problem that concerns the Oaxaca government," he said.
The interior ministry will hold talks with teachers, their supporters and state government officials in Mexico City this week to try to end the conflict.