Quang Van Tien, 23, and Luong Van Thanh, 18, were arrested on Le Loi Street near the renowned Huong (Perfume) River in the central city while they tried to smuggle in the drugs from their hometown in the northern province of Dien Bien.
They hid 14,000 pills that police assume to be synthetic drugs.
They traveled to Hue in a hearse and performed all the rituals Vietnamese usually do at a funeral, including tossing votive paper along the roads and burning joss sticks.
Tien told the police he had bought the drugs from his mother for VND175 million ($7,540) and asked Thanh to help him transport them to Hue.
Police in Hue and Dien Bien are working together to investigate.
Vietnam has some of the world’s toughest drug laws. Those convicted of possessing or smuggling more than 600 grams of heroin or more than 2.5 kilograms of methamphetamine face the death penalty.
The production or sale of 100 grams of heroin or 300 grams of other illegal narcotics is also punishable by death.
While heroin has long been common among users in Vietnam, the use of synthetic drugs like meth or ecstasy is on the rise, especially among youth.
Seven people died after using drugs at an electronic music festival in September last year in Hanoi, alarming authorities.