The president has denounced the shooting and promised compensation to the family of the barber.
A military spokesman says five soldiers have been detained.
The violence broke out after some soldiers visited a hairdresser.
One of their guns went off, fatally injuring the barber.
An angry Tamil mob stoned military vehicles and burned tyres in retaliation.
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Police superintendent Charles Wijewardena visited the scene to try and calm the situation, but military officials say the crowd turned against him.
"The mob had blocked his vehicle and when he got off, he was abducted," police chief Chandra Fernando told AFP.
"We tried to secure his release through ceasefire monitors, but now we have found his body.
"