After initial reports that authorities would prohibit the meat at the summer solstice event in the southern town of Yulin, animal rights groups said vendors and officials reached a compromise setting a limit of two dogs displayed per stall.
But multiple carcasses rested on some stalls at the main Nanqiao market, with stiff pointy tails, leathery yellow skin, eyes shut and bared teeth as if in a final growl.
Behind two long rows of dog butchers, other vendors sold more typical fare like cow tongues and pork hocks and trotters. But even they sold some dog parts, including liver.
There was a heavy police presence outside the market and at all intersections.
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"Despite the fact that there does not seem to be a ban on all dog meat, the festival appears to be smaller this year, with fewer dogs losing their lives to this cruel industry," Irene Feng of Animals Asia told AFP.
Thousands of dogs have traditionally been killed during the festival in conditions activists describe as brutal, with dogs beaten and boiled alive in the belief that the more terrified they are, the tastier the meat.
Between 10 million and 20 million dogs are killed for food annually in China, according to the Humane Society International.
Dog meat consumption is not illegal in China, but animal rights groups have sought to stop its sale at the annual festival.
Outside the market, vendors sold stewed dog meat out of enormous steaming woks, shovelling big portions into plastic bags for passing customers.
Some changed their "dog meat" signs to read "tasty meat" instead. One restaurant put yellow paper over the character for dog.
"Business during the festival goes up about ninefold. But don't worry, we always manage to have enough dogs," he said, adding that he planned to sell six dogs a day during the festival.