Dubai, home to the Burj Dubai, the world's tallest building expected to be completed in 2008, and the first Armani luxury hotel, is seeing an annual average growth rate of 12 per cent, according to the authorities.
The boom is largely driven by construction, fuelled by investment from oil-rich neighbours and made possible by armies of non-unionised south Asian workers.
Stirkes are illegal in the Emirates.
But on Sunday, labourers ignored threats of deportation and refused to go to work, demanding pay increases, improved housing and better transportation services to construction sites.
They staged protests at a labour camp in Dubai's Jebel Ali industrial zone and on a construction site in the al-Qusais residential neighbourhood.
Protesting workers threw stones at the police on Saturday, damaging some police cars.
Ali bin Abdullah al-Kaabi, Dubai's minister of labour, described workers' behaviour as "uncivilised", saying they were tampering with national security and endangering residents' safety.
He told state news agency WAM they had "turned themselves into rioters", rather than registering their complaints peacefully. He said those who damaged public property would be deported.
But construction companies do not want more workers to leave as they struggle to find enough to complete existing projects following a government amnesty that gave free tickets home to illegal labourers.
In June, the government offered an amnesty to illegal workers and were promptly swamped by 280,000 applications for exit papers.
A booming economy in India means that many Indian labourers no longer see the need to travel to Dubai and the Gulf, said Bernard Raj, managing director of the Dubai-based Keith International, which supplies Indian workers.
"In the past, when we go for recruitment of workers we were able to choose whomever we wanted. Now the turnout of candidates is very low," he said.
Raj estimated that at least 40 per cent more workers were needed for the city's projects.
The workers have also suffered from the decline of the Emirati Dihram which, pegged to the US dollar, has plummeted in value, further decreasing labourers' already low salaries.