Several trade unions joined forces with the Stop The War Coalition and anti-fascist groups to march along Brighton's sea front as the conference was opening.
The demonstrators shouted slogans calling for workers to fight back against cuts in public spending and demanding that troops be withdrawn from Iraq and Afghanistan.
As the protesters marched past the conference centre they stopped and chanted: "Gordon Brown, shame on you for turning blue."
Organisers of the protest said they had been expecting 2,000 to take part but estimated that between 3,500 and 4,000 had turned up.
They marched in bright sunshine, past bemused holidaymakers before holding a rally which was addressed by union leaders and anti-war activists.
Leaders of trade unions, anti-war groups and other activists, as well as two Labour MPs, told the rally that the Government needed to change its policies, stop threatening public sector cuts, and bring troops home from Afghanistan immediately.
Green Party leader Caroline Lucas said there was real hope among those taking part in the seafront demonstration, rather than in the “sterile, stage-managed” Labour conference.
“Our message is no more public service cuts, no more bankers’ bonuses, and no more privatisations. It is grotesque that under a Labour government inequality has risen and it is outrageous that 70,000 people are losing their jobs every month while this Government stands by and lets chief executives’ pay soar.”
Labour MP Jeremy Corbyn (Islington North) pressed for an end to the conflict in Afghanistan, warning that it had all the hallmarks of the Vietnam war.
He argued that bringing troops home would have a dividend of ending the “draconian” anti-terror laws which had been introduced in the UK.
Lindsey German, convenor of the Stop The War Coalition, said if the Government had to make savings, it should cut spending on wars.
She noted the latest death of a British soldier in Afghanistan and reminded the crowds that former Defence Secretary John Reid had expressed hope that British troops going into Afghanistan would not have to fire a single shot in anger.
“This is a war we cannot win. We are not bringing democracy to Afghanistan - we are protecting one of the most corrupt governments in the world as well as seeing thousands of innocent Afghan people and hundreds of British soldiers die.”
John McDonnell (Labour MP for Hayes and Harlington) warned there might not be a Labour Party after the next General Election if leading figures did not stop putting personal ambitions before principles.
Mark Serwotka, leader of the Public and Commercial Services Union, said he did not want to see a Conservative government win the next election, but he bitterly attacked Labour for cutting jobs and privatising public services.
Around 100,000 Civil Service jobs had been axed in the last decade and there had been more privatisations in the service than during the combined governments of Margaret Thatcher and John Major, he said.
Mr Serwotka also warned that Labour was planning a fresh attack on public services, adding: “We have had enough of this - it is time to fight back.”
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