By Frederik Richter and Lin Noueihed
MANAMA (Reuters) - Sectarian clashes erupted at a school in Bahrain on Thursday, fueling fears a planned march on the royal court on Friday could inflame the Gulf island where a majority of citizens is Shi'ite but the ruling family is Sunni.
Bahrain, home to the U.S. Navy's Fifth Fleet, has been gripped by the worst unrest since the 1990s since protesters took to the streets last month, inspired by uprisings that unseated entrenched rulers in Egypt and Tunisia.
Moderate opposition leaders urged hardliners to cancel Friday's march, warning it could spark serious clashes between Shi'ites protesting against the government and Sunnis who support it.
Witnesses said fighting broke out at a school in the town of Sar, an area where both Shi'ites and Sunni live, when some Shi'ite pupils launched anti-government protests on Thursday.
They said parents from naturalized families -- Sunnis mainly from Syria and Pakistan who hold Bahraini passports -- came to the school. Shi'ite parents later arrived and clashes erupted.
Shi'ites say they are excluded from jobs in the security forces and view Bahrain's practice of settling Sunni foreigners serving in police as an attempt by its Sunni rulers to change the sectarian balance, an accusation the government denies.
"During the break we went on a peaceful protest, we gathered, a few girls. Next thing we know a group of naturalized people were let into school and the school door was locked, they had iron and wooden sticks and knives," said one student.
It was not clear whether there were any injuries but one witness said he saw an ambulance driving away one girl.
Seven people have been killed in clashes with security forces and thousands of the February 14 youth movement still occupy Pearl roundabout, but the opposition is increasingly split.
Moderates led by the largest Shi'ite party Wefaq are calling for constitutional reforms and have called a less provocative rally on Friday that is expected to draw tens of thousands.
The coalition of much smaller Shi'ite parties behind the march on the royal court are calling for the overthrow of the monarchy and the establishment of a republic -- demands that have terrified Sunnis who fear this would play into the hands of the oil-producing Gulf's main Shi'ite power, non-Arab Iran.
The youth movement urged Wefaq and top Shi'ite cleric Sheikh Issa Qassim on Thursday to help them stop hardliners from "inciting our youths on the roundabout to hold a march at three o'clock tomorrow to the royal court in Riffa to cause strife and the fall of innocent victims in the people's ranks."
The march on the king's palace would go through the Riffa area, where Sunnis and members of the royal family live, risking the first direct confrontation between protesters and royals.
No more than a few hundred are expected to join the march, but politicians and activists on all sides expect Sunni civilians to come out to block their advance.
"Tomorrow will be a tough day," said a political source, who declined to give his name. "If they make the journey they will be met by plainclothes people and not security forces... These protesters are trying to derail the political process because in an election they could not win a seat if they tried."
Protests in Bahrain have been peaceful since the initial clashes, but there have been repeated incidents of fighting between Sunni and Shi'ite residents since.
Bahrain saw the first clashes between Sunni and Shi'ite residents last week when at least a hundred residents fought with clubs in Hamad Town, where people of both sects live.
Over half of Bahrain's 1.2 million population are foreigners. Bahrainis disagree on the exact figures but analysts say over 60 percent of Bahraini nationals are Shi'ite.
Friday's controversial march was backed by Hassan Mushaimaa, leader of Al Haq part, and Abdelwahab Hussein, leader of Wafa, who co-founded a coalition this week to push for a republic.
Sheikh Mohammed Habib Muqdad, a Shi'ite cleric seen as close to Mushaimaa, has since called for the march to be canceled, according to a report in Al Wasat newspaper on Thursday.
Contacted by Reuters, Mushaimaa did not distance himself from the march: "We let all these young people decide if they will go or not... If I'm free I'll go, if I'm busy I won't."
(Additional reporting by Warda Al-Jawahiry; editing by Philippa Fletcher)