China on Tuesday stressed Communist party control over Tibet, with a senior official denouncing the Dalai Lama at a giant ceremony condemned by rights groups.

Thousands of people gathered in front of the iconic Potala Palace in the regional capital Lhasa for an event billed as marking 50 years since the founding of the administrative area of Tibet.

Crowd members waved Chinese flags while "cheering like they were ushering in a new year", the official Xinhua news agency reported.

China says its grants Tibet autonomy, but Beijing tightly controls the region while no ethnic Tibetan has ever held its top Communist post.

Many Tibetans complain of restrictions on Buddhist traditions and economic discrimination.

Beijing denies repression and says its has brought economic development.

Top leaders of the Communist Party of China (CPC) said in a message to mark the anniversary: "Only by sticking to the CPC's leadership and the ethnic autonomy system, can Tibetans be their own masters," Xinhua said.

Yu Zhengsheng, one of China's seven highest-ranking Communist officials as a member of the Politburo Standing Committee, who normally works in Beijing, vowed to continue a "crack down on all kinds of separatist activities", Xinhua added.

China brands the Dalai Lama and his supporters as "separatists" seeking independence for the region, though the Tibetan spiritual leader says he advocates greater self-rule.

Yu told the crowd that "sabotage attempts" by the Dalai Lama and his associates had been "foiled", without giving details.

After Yu's speech more than 6,000 civilians, army and government staff joined a parade "featuring singing, dancing and the release of colourful balloons", Xinhua said.

Beijing established the Tibet Autonomous Region in 1965, 15 years after Chinese troops took control of the area.

It covers only some of the areas in which ethnic Tibetans have historically lived, with the rest of the population divided between several Chinese provinces.

"The so-called Tibet Autonomous Region only covers about half of Tibet," the London-based Free Tibet group said in a statement.

It said the anniversary celebrations were "imposed" on Tibetans by Beijing.

"Tibet is locked down: independent media, human rights organisations and diplomats can't travel there freely," the group added.

"If Tibet's people have a good news story to tell, why doesn't Beijing let them freely tell it."