Stung by the Jal Satyagraha by Ghogalgaon villagers in Khandwa district, the Madhya Pradesh government said the affected had been compensated and those staging the protest had been misguided.
The Jal Satyagraha started on April 11 against increasing the height of the Omkareshwar dam to 191 metres.
An official release said only 221 of the 6,329 families, who were affected by the dam, were still living in villages.
The rest have taken compensation and moved to the rehabilitation sites.
The release said families had been given a compensation package of `153,04,19,000.
In addition to this, chief minister Shivraj Singh Chouhan has also sanctioned a package of `225 crore.
The families have also been given 5,400 sq feet of residential plots at rehabilitation sites and those not taking the plots have been granted Rs 50,000.
All landless families have been given Rs 2.5 lakh each.
The Omkareshwar project will generate 520 mega watts of electricity and irrigate 2.83 lakh hectares of land.
The final dam height will be 196.60 meters.