The Dalai Lama, speaking to reporters, urged his countrymen to show restraint.
He said that "if things become out of control" his "only option is to completely resign."
Later, one of his top aides clarified the Dalai Lama's comments.
"If the Tibetans were to choose the path of violence he would have to resign because he is completely committed to nonviolence," Tenzin Taklha said. "He would resign as the political leader and head of state, but not as the Dalai Lama. He will always be the Dalai Lama."
The recent protests in the Tibetan capital Lhasa, led by monks, began peacefully March 10 on the anniversary of a failed 1959 uprising against Chinese rule. But they grew increasingly violent, culminating Friday with widespread street violence. Chinese officials say 16 people were killed, but the Tibetan government-in-exile put the toll at 80.
While the situation inside Tibet remains unclear, much of the violence appears to have been committed by Tibetans attacking ethnic Han Chinese, the majority ethnicity in China. In the days since then, worries have grown that Chinese troops trying to reassert control over Lhasa were exacting retribution against the Tibetans.
The Dalai Lama also called on Tibetan exiles beginning a six-month march from India to Lhasa to stop their march at the border.
"Will you get independence? What's the use?" he said.
The protests have focused world attention on China's human rights record ahead of this summer's Beijing Olympics. The communist government in Beijing wants to ensure that the Aug. 8-24 Summer Olympics boosts its international image.
"By staging that incident they want to undermine the Beijing Olympics Games, and they also try to serve their hidden agenda by inciting such incidents," Wen told reporters at a news conference held at the end of China's national legislative meeting.
The hardline stance taken by the normally mild-mannered premier underscored the communist leadership's determination to regain control over the region and ensure a smooth run-up to the Games.
"There is ample fact -- and we also have plenty of evidence -- proving that this incident was organized, premeditated, masterminded and incited by the Dalai clique," Wen said. He gave no details.
Wen dismissed claims by the Dalai Lama that there was "cultural genocide" taking place in Tibet and said China will only consider dialogue with the Dalai Lama if the exiled spiritual leader was "willing to give up his proposition for so-called Tibetan independence."
Wen said protesters in Lhasa killed bystanders, smashed public utilities and cars, and set fire to stores.
"They used extremely cruel means," Wen said. "This incident has seriously disrupted public order and life in Lhasa. This incident has inflicted heavy losses of lives and property of the people in Lhasa."
However, Wen said, the city was returning to normal.
"The situation is quiet and calm, and Lhasa will be reopened to the rest of the world," he said.
China's deadline for protesters to turn themselves in or face severe punishment was Monday at midnight. Hours after that deadline passed, the U.S. government-funded Radio Free Asia on Tuesday quoted an unnamed witness as saying that authorities in Lhasa had began arresting hundreds of people.
No details were given and the report could not be independently confirmed because of China's tight control over information and ban on trips by foreign reporters.
Police in Lhasa refused to answer any questions.
An official at the Administrative Department of the city's Communist Party office said Tuesday the city's markets, work places, schools were all back in operation.
"There are no police or troops around our area. But as to whether there are still police sealing off the downtown streets, I am not clear yet," he said. He refused to give his name.
Protests inside China have spilled from Tibet into neighboring provinces and even the capital, Beijing.
As the Tibetan spiritual leader, the Dalai Lama was recognized at age 2 as the reincarnation of the 13th Dalai Lama and enthroned before he turned 4. He assumed full powers at age 15, in the year that troops from Mao Zedong's newly founded communist republic entered Tibet and crushed its small army.
The Dalai Lama fled Tibet following the 1959 uprising, setting up his government-in-exile in Dharmsala.