This year Hong Kong was picked as the first Asian city to host the Gay Games, while a landmark court decision granted a British lesbian the right to live and work in Hong Kong with her partner.
But authorities' reaction to the winning bid for the 2022 Gay Games was lukewarm and the city's immigration department has announced it will appeal the case.
Men in drag and lawmakers joined several thousand participants, many of whom were sporting multicoloured tattoos and holding a massive rainbow flag as they marched through the southern Chinese city.
"There are many people with traditional mindsets here, so for the LGBT community many people should... start speaking out for themselves or else there will be no freedom and we won't have our own rights," a teenage participant who identified herself as Morgan said.
Also Read
"I think many people now, especially the youngsters, are starting to support this and because they're the future of our society I think we should be optimistic," the 14-year-old student added.
In October, Taiwan held its largest ever pride parade with tens of thousands marching amid a sea of rainbow flags and glitzy costumes.
IT consultant Michael Chik, who attended today's parade, said Hong Kong could follow Taiwan's lead but the government was not doing anything.
"It's quite sad," the 37-year-old said, adding that the Taiwanese ruling shows gay marriage is "not against Asian values".
Rights campaigners have criticised the city's government, saying its focus on family values tends to exclude the LGBT community.
Last year, banking giant HSBC placed a pair of rainbow- painted lions in front of its landmark building in the heart of the city to promote support of gay rights, a move slammed as "disgusting" by opponents who rallied in protest.
Disclaimer: No Business Standard Journalist was involved in creation of this content