Spanish fishermen have held a protest near the spot where Gibraltar's government placed 70 concrete blocks in disputed waters next to the British territory.
The demonstration comes 24 hours before the Royal Navy warship HMS Westminster is due to arrive in Gibraltar in a visit described by the Ministry of Defence as "long-planned".
Gibraltar says it has created the concrete artificial reef there to protect local fish stocks from trawling, but Madrid says it restricts their right to fish.
The move has led to further tensions between the UK, Gibraltar and Spain - which has imposed tougher border checks in retaliation.
Around 30 fishing vessels set out from the "Campo de Gibraltar" in southern Spain to form a floating protest - a smaller number than expected.
Sky's David Bowden, at the scene, said hundreds of Gibraltarians turned out in force to rebuff the protest.
"They lined the bay as a flotilla of small fishing boats sailed across from Spain at the other side of the Bay," he said.
"The flotilla, only a dozen or so boats strong, was escorted by a handful of sleek Spanish Guardia Civile speedboats.
HMS Illustrious docks at Rota naval base on Gibraltar "They were met by an equally strong show of force from the Gibraltar marine police in patrol vessels and highly manouvreable ribs making sure the Spanish invaders did not stray off the imaginary line in the sea that marks Spain from British Gibraltar."
The Spanish government has accused Gibraltar of laying the blocks "without the necessary authorisation" in "waters that are not theirs".
It responded by introducing additional checks at the fenced border, and suggesting a 50 euro (£43.30) fee could be imposed on every vehicle entering or leaving Gibraltar.
On Friday, Prime Minister David Cameron raised the matter with European Commission president Jose Manuel Barroso.
He said the checks - which have seen huge delays at the border in recent weeks - were "politically motivated and disproportionate" and therefore contrary to the EU right of free movement.
UKIP MEP William Dartmouth, member for the South West of England and Gibraltar, has suggested that a member of the Royal family should visit Gibraltar to mark 300 years of British sovereignty.
The border checks have led to massive queues in recent weeks "Nothing could demonstrate more to the citizens of Gibraltar how strongly Britain stands behind them in wishing to stay part of the United Kingdom than a visit by a member of the royal family," he said.
The row has set relations between Spain and the territory back 40 years, according to Edward Macquisten, chief executive of the Gibraltar Chamber of Commerce.
He said it was also having an impact on Gibraltar's high season tourist trade, which usually sees hordes of British visitors from Spanish resorts.
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