Venezuela’s political divide spilt into violence on the streets of Caracas as thousands of people rallied, some to protest and others to celebrate, the closure of the country’s oldest and most watched private television station.

Radio Caracas Television (RCTV), an opposition-allied station, went off the air at midnight on Sunday after President Chávez withdrew its licence, accusing the network of “coup plotting”.

The move has fuelled accusations that Mr Chávez is moving towards an increasingly authoritarian rule and is quashing dissent against his “socialist revolution”.

Police and protesters clashed as thousands joined a rally in the hours before midnight, banging pots and pans and blowing whistles. Water cannon and rubber bullets were fired to disperse the crowds.

As the evening went on protesters convened at the RCTV studios, where the channel’s best-loved actors and presenters wept and embraced in their final moments on air. They bowed their heads in prayer and a presenter declared “Long Live Venezuela! We will return soon”, before the national anthem was played and the screen went black.

Seconds later it was replaced with the insignia of TVES, the new state-funded channel, which was shown on huge screens to supporters who were gathering in the streets at the President’s instigation.

The decision by Mr Chávez “marks a turn toward totalitarianism”, Marcel Granier, chief executive of RCTV, said. “He’s losing more than he thinks he’s gaining. He’s losing international recognition and he’s losing the respect of his people.”

Observers believe that Mr Chávez is conducting a high-risk strategy in an attempt to dominate political discussion. “People like Chávez, not Communism,” Luis Vicente León, an economist and pollster said. “And they like a free media. This may be a strike too far for them.”

Mr Granier said that RCTV would continue its battle to stay on the air. “This Government is full of fear. It can’t stand criticism,” he said. “We will fight this in the courts. We will do what we have to.”

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