Two men have been charged with riotous behaviour in connection with the serious public disorder at the interface area between Corcrain Road and Obins Drive in the Co Armagh town.
Officers came under sustained attack from paint bombs, petrol bombs and other missiles - sledge hammers were also used to damage armoured PSNI vehicles.
A total of 19 plastic baton rounds were fired during the trouble which continued into the early hours of the morning.
No police and no members of the public were injured.
Three arrests were made. A 24-year-old man has been charged with riotous behaviour and criminal damage, while another - aged 42 - faces those counts plus possession of a weapon.
A third man aged 20 was charged with disorderly behaviour, resisting police and assault on police - he was arrested in the area but isn't directly linked to the disturbances.
It is believed social network sites and mobile phones were used to gather people from outside the area for what was originally planned to be a peaceful protest by residents over the removal of loyalist flags.
"Police received information that loyalists intended to lead a peaceful protest," Superintendent Jason Murphy said.
"The peaceful event did indeed take place but that quickly descended into disorder. It was clear from very early that there was a number within that group who were intent on violence from the outset."
Reverend Ken Robinson, who was in the area trying to calm things down, said the trouble was a reaction to nationalists allegedly having been allowed to remove the flags.
"I do believe further up the road in the Corcrain estate that a number of flags were removed on Thursday night," he told UTV.
"The allegation is that nationalists removed them and the police allowed them to remove them - but whatever the justification, there is no excuse for last night."
As the violence continued into the night, police advised motorists to avoid the Corcrain and Ballyoran areas, Obins Drive, Union Street and surrounding areas.
Sinn Féin MLA John O'Dowd said loyalists tried to attack nationalist homes during the disorder.
"What is known is that around 100 loyalists attacked police and attempted to attack nationalist homes in the Portadown area over several hours," he said.
"I would appeal for calm to return to the streets of Portadown. I'm in no doubt that the vast majority of people, whether they are from the unionist or nationalist community want to see an end to this trouble. They want to see order restored and they want to be able to get on with their lives."
However the DUP's Upper Bann MP David Simpson refuted Mr O'Dowd's comments, saying fireworks had been directed at Protestant homes in the area.
"The initial rioting was provoked by nationalists firing missiles and removing union flags from mainly unionist areas," Mr Simpson said.
"The violence on Friday evening will not stop such unprovoked attacks from nationalists, the rioting only serves to disrupt and deface the locality. I know many elderly people living in the area where living in fear last night and did not endorse this violence. Such scenes must be condemned."
A PSNI statement said: "No homes within the nationalist community were directly attacked although we are aware of some damage being caused from missiles thrown into the area of Obins Street."
Upper Bann Alliance councillor Sheila McQuaid called the trouble "deeply damaging" for the local area.
"I am disgusted at the activities of those involved in this disorder," she said.
"I would appeal for people to act responsibly. This type of incident is deeply damaging and we need to ensure stability to help us grow our economy."
Police have come under attack across parts of Northern Ireland in the past week.
Rioting already broke out in Portadown on Wednesday night, this time in the Garvaghy Road area.
In the early hours of Tuesday morning two police officers were injured after trouble also erupted in the Craigwell Avenue and Obin Street areas of the town.
A PSNI operation is planned for Saturday night to prevent any repeat of Friday's rioting.
"Despite the violence against my officers last night, I can assure the public of Portadown that we remain steadfast in our determination to work with all communities to make Portadown safe," a statement added.
"The law abiding people of Portadown want to see peace, harmony and most of all prosperity and we stand ready as a police service to play our part."