The state of Rio, which is fighting off bankruptcy, has stopped paying salaries and pensions amid the crisis -- leaving nearly half a million people and their families to depend on private charity.
Paralympics were declared open during a mammoth opening ceremony at the Maracana stadium
Police arrest more than 50 demonstrators in São Paulo.
Local media reported that two youths and a police officer died in the incident in the Complexo do Alemao shantytown.
A World Cup security plan for Rio de Janeiro, which swells the number of police patrolling the city's streets to 2,000, has been brought forward after a spike in violence.
Brazil's biggest shantytown, located in Rio, is under tight security after at least one person is killed in gun battles with criminals reportedly attempting to retake the territory.
Cars were set ablaze and police presence was reinforced in a Rio de Janeiro shantytown after an elderly woman is killed in crossfire between police and criminals. World Cup kicks off in less than seven weeks.
Scenes of violence, vandalism and looting in Rio de Janeiro as police retake a vast disused commercial building complex from squatters.
Some 2,700 federal troops will be deployed to the Maré favela complex located near Rio's international airport for the World Cup.