The convoy of protesters gathered in the Museum Reserve on Saturday morning before marching along Great King St to the Octagon.
It was the second rally for Palestine in the past two weeks.
Activist groups attending the rally were mainly supporters of the Palestine Solidarity Network Aotearoa (PSNA).
Speakers included Dr Rula Talahma, Palestinian community leader Mai Tamimi, Taieri MP Ingrid Leary and Dunedin city councillor Christine Garey.
Rally organiser Oscar Bartle said the group demanded a ceasefire and a stronger government position on one.
"Nearly 10,000 people have been murdered in Gaza so far: sons, daughter, mothers, grandfathers, husbands and wives.
"If the government can sanction Russia for their war on Ukraine, why can’t they do the same with Israel?"
Numerous placards and banners at the rally declared their support for Palestine, and messages were written in chalk on the streets.
Dunedin city councillor Marie Laufiso, who attended the rally, said there was a lot of korero (talk) in the community about Palestine.
"I think Dunedin people that are marching are frustrated with our government staff and they want some moral justice.
"They want our political leaders to have some guts and stop thinking about their monetary interests with Israel and America and actually stand up for vulnerable children."
Dunedin resident Rinad Tamimi, a representative of the Palestinian community and PSNA spokeswoman, attended the rally with her daughter Laya.
She had felt survivor’s guilt ever since she left Palestine 15 years ago.
She had 50 relatives living in Palestine, including her grandparents, and she was worried about them.
The rally made her feel like she was doing something for her home country.
"This protest means a lot to me and a lot to my family.
"It means the world to me to actually see people standing up with us because it makes me think humanity is still alive, people still care."
The hundreds present showed that many people cared deeply about a ceasefire, she said.
The city needed to continue to educate people, raise awareness and hold demonstrations.
"We must use our voices for them."
tim.scott@odt.co.nz , PIJF cadet reporter