HRW urges Saudi authorities to "take immediate steps to allow people to safely return home, allow business and clinics to reopen, and compensate residents for property damage and destruction caused by security forces."
Saudi Arabia's security forces have sealed off a Shia-majority town in the east of the Sunni-ruled kingdom, Human Rights Watch said on Sunday, following months of unrest and clashes with police.
Saudi authorities last week said they seized control of a district of Awamiya, a town in the eastern Qatif region where protests have escalated into clashes with security forces in recent months.
HRW on Sunday said Saudi security forces had completely "surrounded and sealed off" Awamiya.
The New York-based group said that, based on comparative satellite imagery from February and August, large sections of the town had sustained extensive damage, including to civilian infrastructure.
"Saudi authorities should take immediate steps to allow people to safely return home, allow business and clinics to reopen, and compensate residents for property damage and destruction caused by security forces," HRW's Middle East director Sarah Leah Whitson said.
Saudi authorities have blamed "terrorists" and drug traffickers for the recent unrest in Awamiya, where clashes between protestors and security forces since May have left civilians and police dead.
The town in Saudi Arabia's oil-rich east was also the hub of a short-lived protest movement in 2011 inspired by the Arab uprisings.
One of the movement's leaders, Shia cleric Nimr al-Nimr, was executed in January 2016 on a terrorism indictment. Nimr's execution triggered more sectarian tension both across the Gulf and with Saudi Arabia's main regional rival, Shia Iran.
Saudi Arabia's minority Shia community, which makes up an estimated 10 to 15 per cent of the country's population of 32 million, has long complained of marginalisation.