The peaceful march took place in the state capital Munich, around 100 kilometres (60 miles) north of the Alpine venue where Chancellor Angela Merkel is to welcome leaders from the club of rich nations from Sunday.
Authorities estimated the turnout by mid-afternoon at about 34,000.
Environmentalists, opposition parties and anti-globalisation activists called the rally under the banner "Stop TTIP - Save the Climate - Fight Poverty". The TTIP or Transatlantic Trade and Investment Partnership is a proposed trade deal currently under negotiation between the US and Europe.
Hundreds of demonstrations against the planned pact were held across Europe in April.
Merkel, who holds the Group of Seven presidency this year, will host the two-day meeting with the leaders of Britain, Canada, France, Italy, Japan and the United States.
A massive police presence is planned at the summit in Elmau Castle near the Austrian border.
Thousands of officers from across Germany will be guarding the venue, with demonstrations planned in and around the nearby town of Garmisch-Partenkirchen.
The summit is expected to cover international trade, the push for a UN climate accord, public health, poverty reduction and global security crises, among other issues.
G7 opponents say the world's top industrialised countries have repeatedly failed to take decisive action on the most pressing topics facing people around the world.
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