The demonstrators, mainly peasant farmers, have set up roadblocks and barricaded themselves inside a town near Mexico City, to demand that the government abandon the project. They are holding at least a dozen hostages who they say will be freed once the authorities release a number of demonstrators arrested during clashes with the security forces on Thursday. The BBC's Nick Miles, reporting from the scene, says the situation is tense, and although hundreds of riot police and troops are so far keeping a low profile, they are ready should the decision be taken to free the hostages by force. Men, women and children, armed with machetes and Molotov cocktails, are inside the small town of San Salvador Atenco, 30km (19 miles) from Mexico City and close to the site of the proposed airport. The protesters accuse the three hostages captured on Saturday of being police spies. "Our position remains the same. We continue to defend our land. For the past 36 hours we have said we want an exchange - they give us our people and we give them theirs," said protest leader David Pajaro. The campaigners say they will only talk to federal, not state, authorities. They have also proposed that any dialogue be mediated by former Chiapas bishop, Samuel Ruiz, who negotiated with the Zapatista rebels in the southern state.

- New airport

Mexico City's existing airport only has one runway which can be used at a time, and there is no space to expand. President Vicente Fox's government has approved plans to build a six-runway, $2.3bn airport that will wipe out most of San Salvador Atenco and other surrounding communities. Residents have been protesting for months at the government threat to expropriate their lands for the 11,000-acre (4450 hectares) project.

A government order entitles residents to as little as 70 cents per square metre of land, a price they say is ridiculously low. But many residents are opposed to the airport regardless of what they are offered. Interior Secretary Santiago Creel said on Friday that federal officials would negotiate with any groups willing to reach an agreement. But he denounced the use of violence, saying President Fox would "act with a firm hand to avoid an increase of violence in the country."