The police denied that Gandhi was arrested.
The Congress leader arrived in Varanasi on Friday morning and met the injured persons admitted to the Trauma Centre at the Banaras Hindu University.
When she proceeded towards Sonebhadra, her convoy was stopped on the Mirzapur border.
A defiant Gandhi then squatted on the grounds with Congress workers and was later taken away in a government vehicle to Chunar.
She told reporters, "I don't know where are they taking me. We are ready to go anywhere."
Gandhi asked the officials for written orders on why she was being prevented from going to Sonebhadra.
"I just want to meet the families of the victims. I am willing to take only four people with me because I do not want to defy the prohibitory orders and yet the district administration is not allowing us," she complained.
At least 10 people, including three women, died and over 24 were injured in a clash between Gond and Gujjar communities over a land dispute in Sonebhadra district on Wednesday.
Before being taken to Chunar, Gandhi said that she would not be cowed down by the police action which she argued had no legal basis.
Soon after news came in that Gandhi had been whisked off to Chunar, Congress leaders staged a dharna at the Gandhi statue in Lucknow.
Congress MLC Deepak Singh said that the state government was behaving like a dictator.
"Priyankaji was not defying any prohibitory orders. She simply wanted to meet the victims. Will the government now decide who can meet whom and when?" he asked.
A Samajwadi Party delegation which was on its way to Sonebhadra was also prevented from going there.
Former Congress President and Priyanka's brother Rahul Gandhi described her detention was "disturbing".
"This arbitrary application of power, to prevent her from meeting families of the 10 Adivasi farmers brutally gunned down for refusing to vacate their own land, reveals the BJP government's increasing insecurity in UP," he tweeted.
Police have arrested 24 people in connection with the caste violence. A case has been filed against 78 people.
( With inputs from IANS )