The authorities said they would carry out an autopsy on the fruit seller to determine how he died.
Similar rumours sparked days of rioting in Guangdong province in June.
The Guangdong riot snowballed into a wider protest about official corruption and discrimination against migrant workers.
In Anshun, the unrest appears to have been limited to anger over the street trader's death.
The state-run China Daily quoted a statement from Anshun's local government confirming the hawker had died.
The statement did not comment on the cause of his death, but said "before the incident occurred, chengguan [urban management officers] were working in the area".
Local police had earlier told the Xinhua news agency that the trader had been involved in an argument with the officials.