Berlin Mayor Klaus Wowereit, who is openly gay, cut the ribbon to start the parade, which is overtly political as well as musical and with an emphasis on outrageous costumes.
The march takes its name from a street in New York where homosexuals first offered organised resistance to official repression after a gay bar was violently raided by police in 1969.
The message in Berlin is that gay people still face discrimination and violent attacks even in such nominally liberal countries as Germany.
“There is still daily discrimination against, and attacks upon, homosexuals,” said Wowereit. “We have to fight for equal rights for as long as that remains the case.”