A pro-democracy candidate won a Hong Kong by-election Monday in a closely-watched vote that highlighted the city's political faultlines.

Alvin Yeung of the established pro-democracy Civic Party defeated Holden Chow of the pro-Beijing Democratic Alliance for the Betterment of Hong Kong by more than 10,000 votes.

The third-placed candidate for the New Territories East seat, Edward Leung, 24, was a Hong Kong activist who seeks independence from China and has been charged over recent street battles with police.

Leung is one of the leaders of Hong Kong Indigenous, part of a "localist" movement in the semi-autonomous city that is fiercely opposed by Beijing.

The student won 66,524 votes, to Yeung's 160,880 and Chow's 150,329 in the contest triggered after a prominent pro-democracy politician stepped down.

Since massive rallies in 2014 calling for fully free leadership elections failed to win concessions from Beijing, young protesters like Leung have become increasingly disillusioned with more established pro-democracy parties.

Smaller groups have emerged under a "localist" banner, pushing for greater autonomy and even independence from China as fears over interference from Beijing grow.

Their frustrations spilt over into violence earlier this month when running battles with police left more than 100 injured.

Leung, who is facing a rioting charge for his involvement, had said Sunday that "Hong Kongers are the masters of their own soil".

Hong Kong was handed back to China by former colonial power Britain in 1997 and its freedoms are protected by a 50-year agreement.

But there is growing concern those freedoms are under threat as China seeks to stamp its authority on the semi-autonomous territory.

Yeung had criticised Leung's involvement in the street battles and defended the pro-democracy movement's peaceful track record.

"I understand people are not satisfied, but... we need principles and our bottom line is non-violence," Yeung told AFP.

The pro-Beijing camp casts democracy campaigners as a threat to stability and prosperity in Hong Kong.

Beijing has dismissed localists as "separatists" -- a label they do not shy away from.