Tear gas was fired at City University in Kowloon Tong and at Chinese University, where protesters threw petrol bombs and bricks in a tense standoff with police.
Students at Chinese University had been in negotiations with its principal, who pleaded with them not to throw anything onto the highway from the school's hillside vantage point. However, the students refused to follow suit unless the arrested students were released. Police responded with rubber and sponge bullets.
“The university is where I live," an 18-year-old student who would only give his name as Jimmy said. "I don’t want the police to destroy our beautiful campus. Officers bypassed the university and entered here to make arrests. Any negotiations for retreat wouldn’t help."
Hong Kong Police said in a statement that they had "communicated with the school and are arranging a retreat to stop the standoff." Police appealed to protesters to retreat and "stop charging."
Protesters at City University had stockpiled bricks and petrol bombs on the bridges and other approaches and were making small devices with nails. They had overrun the campus and were smashing up the next-door Festival Walk shopping mall and setting fires.
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"It's crazy that police have been firing tear gas for more than 20 minutes. If they didn't come in, we wouldn't clash with them. It's our school. We need to protect our home," Candy, 20, a student, told Reuters.
Several people were wounded, including a student reporter hit in the eye, apparently by a brick, who was sitting in tears as friends offered comfort.
Meanwhile, a flash mob of more than 1,000 protesters, many wearing office clothes and face masks, rallied in the center of the city for a second day during lunch hour, blocking roads below some of the city's tallest skyscrapers and most expensive real estate.
"Our society has been pushed to the brink of a total breakdown," a police spokesman told a briefing, referring to the last two days of violence in the former British colony.
He said masked "rioters" had committed "insane" acts, such as throwing trash, bicycles and other debris onto metro tracks and overhead power lines, paralyzing the transport system.
He said the man set on fire Monday was still in critical condition and appealed for information on who was responsible.
Police also fired tear gas in the nearby new town of Tai Po and in the densely populated Kowloon district of Mong Kok, whose shopping artery Nathan Road has been the scene of many clashes.
Hong Kong leader Carrie Lam said protesters were being extremely selfish and hoped that universities and schools would urge students not to take part in the demonstrations.
More than 260 people were arrested Monday, police said, bringing the total number to more than 3,000 since the protests escalated in June. Schools and universities said they would close again Tuesday.
So far, China has been reluctant to become directly involved in the unrest. But according to one lawmaker, the situation was already being controlled by the Chinese central government.
“I think the police force in Hong Kong are now under the command from Beijing," said Eddie Chu, a member of Hong Kong's Legislative Council.
"Carrie Lam herself is just the face of HK government. The Liasion Office and Beijing have the total control. It’s only a face-saving gesture for her to be here.”
Chu said ultimately Beijing could decide through its response whether the protests would be peaceful or not.
"At the end, it’s the choice of Beijing if they continue to push the police to the front line and crack down protests, whether they’re violent or peaceful," he said. "This will only escalate the violence on both sides. The only way to end this movement is by political concessions by the government."
Protesters are angry about what they see as police brutality and meddling by Beijing in the freedoms guaranteed under the "one country, two systems" formula put in place when the territory returned to China from British rule in 1997.
China denies interfering and has blamed Western countries including Britain and the United States for stirring up trouble.
Patrick Smith is a London-based editor and reporter from NBC News Digital.