Leaders of opposition parties were among those detained during a massive security operation but it failed to thwart the outlawed demonstration which saw 50,000 citizens take to the streets of Kuala Lumpur, according to organisers.
Protesters faced baton-wielding riot officers in front of a downtown bus station, retreating at times and regrouping to push back police lines in a cat-and-mouse confrontation that took place in a downpour.
Some of the demonstrators fought back by picking up tear gas canisters which they lobbed at police, reporters said.
Opposition leader Anwar Ibrahim was injured during the protest when he fell onto the pavement after a tear gas attack and was taken to a hospital as he was feeling unwell, an aide said.
The protesters dissolved into three main groups, and by late afternoon all were trying to force their way through a tight police cordon to a stadium and then to the king's palace to hand over a memorandum detailing their demands.
The police line, however, held firm.
"Why is the government trying to intimidate citizens?" said Mohamad Manij Abdullah, 50, a businessman who joined the rally.
"We are only trying to reform elections and have a free and fair government," he said.
An official police Facebook page said 924 people were detained and they included Ambiga Sreenivasan and Maria Chin Abdullah, the two top leaders of Bersih, the broad coalition that organised the protest.
"Ambiga and myself have been arrested," Maria Chin told this news agency as she was being transported in a police van to an unknown location.
Abdul Hadi Awang, president of the Pan-Malaysia Islamic Party (PAS), the country's largest Islamic opposition grouping, was also arrested.
The protesters rallied in several areas of the city but later began to disperse, said Subramaniam Pillay, one of the organisers, who described the day as "a great success".
Student Chew Ai Nee, 30, said: "We have to take to the streets because we have not been given any opportunity to express our demands for change... the government cannot silence us when we march."
Many of the protesters were shouting "Reformasi!" (Reforms), "God is great" and "Long Live the People."
However, Mukhriz Mahathir, a leading member of the powerful United Malays National Organisation (UMNO), said the government had to act to prevent anarchy.
"We cannot allow a minority group to protest and stir trouble in the country," he said, accusing protesters of provoking the police into firing tear gas "so that they can accuse the government of being heavy handed."
UMNO is the dominant party in the ruling Barisan Nasional coalition led by Prime Minister Najib Razak.
New York-based watchdog Human Rights Watch (HRW) denounced the arrests.
"This is a maelstrom of the Malaysian authorities' own making," said Phil Robertson, deputy director for HRW's Asia Division.
Downtown Kuala Lumpur, normally a hive of activity on weekends, was deserted as major roads into the commercial and tourist district were sealed off.
Meanwhile, about 30 Malaysians living in South Korea rallied in Seoul in support, with another 80 marching through central Hong Kong.
Organisers had called for solidarity walks and demonstrations in countries including Australia, Cambodia, Japan, the United States and Taiwan.
The demonstrators want reforms, including the eradication of vote buying and the prevention of irregularities such as people illegally voting several times during elections.
Bersih wants to see the use of indelible ink to prevent multiple voting, equal access to the media for all parties and the cleaning-up of electoral rolls.
Malaysia's opposition made major gains in 2008 elections against the ruling coalition but said they could have won more if voting rules were fair.
The country's next elections are widely expected to be called early next year, with the opposition aiming to end Barisan's half century rule.
Jul 9, 2011, 04.27pm IST
This is the second rally organised by Bersih ... the first was also an astounding win for the Rakyat ( people aka citizens of Malaysia ), an eye-opener for the ruling party ... but they do not listen ... they only hear.
The police were brutal ... chemical-laced tear-gas ( the first rally, the second, yet to be confirmed ), assault and battery ... they threatened with batons and kicked peaceful demonstrators who were sitting on the ground.
Thanks to former PM Mahathir, we do not have an independent Judiciary ... it takes orders from the UMNO.
Mukhriz utters rubbish as with those he represents ... this is not a minority group ... the minority are the ones in power ... the ones that will someday cause anarchy ... the ones who will ... someday ... be following the foot-steps of the rulers-in-exile.
Yes, and some words synonymous with that sentence are ... turmoil, unrest, mayhem, ferment, bedlam, chaos, anarchy ... and water-canon.