Echoing the nonviolent protests that toppled the Ukrainian government in late 2004, some opposition supporters have set up tents by the parliament and vowed a long-term presence.
The days of violence -- the worst since the 1956 Hungarian Uprising -- have prompted calls by the conservative opposition for the Socialist prime minister to resign. But the government has blamed the unrest on right-wing soccer hooligans and vowed not to bend to pressure.
The crisis was triggered by a leaked recording on September 17 of Gyurcsany admitting to having lied about Hungary's economic state in order to win reelection. Hungary's budget deficit for this year is estimated to be higher than 10 percent of gross domestic product -- the largest in the 25-nation EU.
Hungary's plunge into unrest has surprised many observers because for years Hungary has been regarded as a showcase of successful transition from communism to democracy.
"From an outside European perspective, what is going on in Hungary is kind of puzzling for us, because in our minds, Hungary has always been a very stable and solid country," says European affairs analyst Katinka Barysch of the London-based Center for European Reform.
"It was the poster boy of transition for many years, it's not a country which in our minds is associated with instability," she adds. "It was very difficult to understand. Apparently there must have been a lot of frustration bubbling away under the surface which is now coming out."
The sight of street protests in a postcommunist country inevitably prompts comparisons with the "colored" revolutions that have occurred farther east in recent years. These protests mostly used nonviolent resistance to oppose governments seen as entrenched and authoritarian and called for democracy and liberalism instead.
But analysts say there is little in common between what is happening in Budapest and what happened in countries such as Ukraine, Georgia, or Kyrgyzstan. That is because Hungary already has the democratic institutions the other protests demanded.
Barysch calls parallels between Hungary and Ukraine's Orange Revolution far-fetched. "I don't see that [same situation as in Ukraine] happening [in Hungary]. I do believe that Hungary is a much more stable, and a country where democracy is consolidated," she says.
"The Ukrainians went through a decade of watching an utterly corrupt and cynical political establishment at the top," she continues. "In Hungary that's not the case. There might be a certain amount of disillusionment with the political class after the prime minister admitted of having lied to the public. But I don't see any kind of political meltdown, still."
Kester Eddy, a Budapest-based freelance business journalist, also said that despite some resemblances, analogies between the current Hungarian crisis and Ukraine's situation of two years ago are largely artificial.
"Ukraine, as far as I understand, two years ago was very definitely not a democracy," Eddy says. "Most observers could agree to that. The protesters had a real grievance [during] the Orange Revolution. Here, I think, it simply is not the same basis for this kind of grievance."
Eddy also adds that Hungarian officials have dismissed the claims by some violent protest groups that the riots are an echo of the 1956 uprising, whose 50th anniversary is on October 23.
"For example, even the President [Laszlo Solyom] said these violent people must realize it's their responsibility what they are doing," Eddy says. "And this is, they're also cloaking it [by saying] 'we're a kind of 1956 revolutionary descendants.' And the president said they had nothing to do with 1956 at all."
Confirming Euroskeptics' Fears
However, Hungary's troubles come at a sensitive time from a European perspective. The European Union has been grappling with a prolonged debate about an EU constitution, and fatigue after its biggest-ever enlargement in 2004, of which Hungary was part.
Analyst Barysch says this could play into the hands of the opponents of further enlargement, who could argue that, if top-of-the-class Hungary shows surprising weaknesses, other countries may be even less prepared.
"It is obvious that this comes at a very sensitive point in time and the EU is having a debate about such issues as enlargement fatigue and should more countries be coming in, and, is Bulgaria ready, and should we be taking in the western Balkans [countries], with all their political problems, should we take in Turkey that in many ways is still a backward society, so it comes at a very sensitive time," she says.
Barysch concludes that the real danger coming from the Hungarian unrest is that Euroskeptics within the 25-member bloc could use it as an excuse for demanding that preparation periods be much longer for future EU members.