Three young Thai Muslims have been killed and seven wounded during an attack by an unidentified armed men at an Islamic school in the south of the country, police said.

Explosives were hurled and shots fired at the Bamrungsart Pohnor school, a boarding school in Songkhla province late on Saturday, said colonel Thammasak Wasaksiri.

Attackers fired dozens of bullets into the school's dormitory where about 75 boys and teenagers were sleeping, Thammasak said.

Police said the attack was staged to try and convince local Muslims that the authorities were behind the violence in an ploy to win villagers over to their cause.

Muslim villagers staged a protest Sunday morning, saying they did not believe Muslims were behind the attack.

More than 500 protesters gathered outside the school, carrying the dead children's bodies through the crowd and setting fire to two buildings at a nearby government-owned school. Some hurled stones at police.

"The villagers are accusing paratroopers of attacking the school," Thammasak said.

Muslims fleeing

The latest violence comes after a Malaysian newspaper reported that a group of Thai Muslims crossed the border into Malaysia, complaining of harrassment by the Thai military.

The group of seven men and 17 women said they had been beaten and that family members were missing or detained, the Star said.

The Thai government installed after September's military coup says it is pursuing a policy of reconciliation to restore peace in the south, where separatist violence has killed 2,000 people since 2004.

A minibus attack that killed eight people last week has infuriated the Buddhist minority in the region and prompted authorities to increase security.

PHOTO CAPTION

Muslim men sit next to the bodies of students at a mosque in Songkhla province. (AFP)