LOZNICA, Serbia (Reuters) - Scores of people in western Serbia's town of Loznica rallied on Friday to protest the contested Rio Tinto lithium project in the Balkan country, fearing its development will damage the environment.

Regarded as a critical material by the EU and the United States, lithium is used in batteries for EVs and mobile devices.

In 2022, the Serbian government revoked licences for Rio Tinto's $2.4 billion Jadar lithium project near Loznica after protests by green groups who say the mine will irreversibly pollute land and water in the lush Jadar valley and the nearby River Drina.

Protesters demanded that parliament adopt a law on a ban of geological research and exploitation of lithium and borates within 40 days.

"If they fail, on the 41st day we will block Serbia, we will block key points, railroads ... and that's only the beginning," Marijana Petkovic, a green activist told the crowd.

Throngs of people from across Serbia, including a group of about two dozen activists who for three days hiked 80 miles from the capital Belgrade, waved national flags, chanted "Uprising," "Rio Tinto go away from the Drina," and sung patriotic songs.

Last week, Serbia's President Aleksandar Vucic said Belgrade is preparing to give Rio Tinto the green light to develop Europe's largest lithium mine, for which the company said it would be safe for the environment.

"If they open the mine, our children will eat polluted food," said Milena, a 62-year-old farmer from the nearby village of Trsic.

If completed, the Jadar project could supply 90% of Europe's current lithium needs and help to make the company a leading lithium producer.

In 2021 and 2022 Serbian environmentalists collected 30,000 signatures in a petition demanding that parliament enact legislation to halt lithium exploration in the country.

To bolster economic growth, Belgrade has offered mineral resources to other foreign investors including China's Zijin (601899.SS) copper miner.

(Writing by Aleksandar Vasovic, Reporting by Ivana Sekularac; Editing by Diane Craft)