41-year-old Prabha Arun Kumar, an IT consultant from Bangalore, was brutally stabbed to death on Saturday night in a Sydney suburb just 300 metres from her home.
Despite bad weather, people came to attend the service with flowers and candles and walked up to the park where Kumar was stabbed.
The service was initiated by another Indian in Sydney Arunesh Seth on Facebook.
"We want to live in a non-violent society. We want to live in dignity," Seth was quoted by media reports as addressing the crowd.
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"I've spoken to plenty of women and they are having their own complaints. They are being abused on this path and they are chased away," he said.
"We can learn from this and we would like if in the future this doesn't repeat. We (want to) go to work and do our daily stuff in peace and to live a dignified life," he said.
Parramatta police superintendent Wayne Cox also attended the service and paid floral tributes.
Sydney-based cardiologist Yadu Singh said that the crime situation in western Sydney was a matter of concern and the the issue needed urgent attention by the state police and government.