Residents of Venice staged a mock funeral yesterday to highlight the dramatic decline in its population, which has led to it being called a dying city. A symbolic red coffin passed along the city's canals with an escort of gondolas in a lament for the decline of the once-thriving lagoon port.

Official figures seem to confirm that as a living city, Venice, one of the most beautiful and evocative places in the world, is on the way to extinction. In the 1950s, there were about 180,000 native Venetians living in the old city, but since then the population has collapsed. The latest count is 59,992.

La Repubblica newspaper compared the remaining citizens to American Indians languishing on a reservation. Some reports have suggested that there might not be a single "true" Venetian left in the city within 20 years.

The campaign group Venessia – the name of the city in the widely-used local dialect – said the mock-funeral was the beginning of the fight back. The group's founder, local pharmacist Stefano Soffiato, said: "The event is designed to make people aware of the problem of the depopulation of the city. Who knows, it could even spur a rebirth. We have to create a Venice new residents will want to stay in."

Experts say that it is less Venice's ever-present problem with rising water levels that is to blame for its plight than the incessant flood of tourists, who swamp the city all year around. The ever-increasing number of visitors has bumped up prices of everything from food to property, causing Venetians to pack their bags and make way for wealthier outsiders seeking second homes.

At the end of August, local government officials promised "drastic" new moves to curb the daily tourist influx that is driving residents away. "There's a physical threshold you can't go over," councillor Enrico Mingardi said.

The authorities have already introduced fines for rowdy tourists in an attempt to clean up Venice's city centre. Locals describe St Mark's Square, one of the world's most famous tourist attractions, as "a little casbah" because the growing army of itinerant salesman, many of them touting counterfeit designer bags.

Mayor Massimo Cacciari has recruited a squadron of 70 local volunteers to target transgressing visitors with leaflets that provide instructions in five languages on how to behave, and make it clear they face fines of up to €150 if they fail to conform. They also issue warnings to scantily clad sunbathers and tick off litter-louts.

But not everyone supports the "funeral". Mayor Cacciari dismissed the event as "nonsense". Some observers pointed out that the interests of residents are often in conflict with those of local retailers and hoteliers, who have profited massively from the huge influx of tourists.

The funeral coincides with the arrival of a team of American researchers investigating the DNA of Venetian natives in the hope of locating their origin, thought to lie in eastern Europe.

Venice in numbers

180,000 Venice's resident population in the 1950s before tourist numbers began to soar

59,992 The city's resident population today, after decades of emigration

20 million Estimated number of tourists visiting the city annually – 55,000 per day