The event had been scheduled today, but the prime minister announced yesterday that it would have to be cancelled after far-right groups threatened protests.
"Local police have decided to ban all gatherings scheduled for tomorrow ," Prime Minister Ivica Dacic said.
"It could not currently be guaranteed that Gay Pride would pass off without incident," said Dacic, adding that both lives and property could have been jeopardised by the event.
It is the third time that Serbian authorities have banned Gay Pride at the eleventh hour, a sign of how divisive the issue remains in Serbia.
Before yesterday's announcement, several far-right organisations had said they would protest today at the time when the parade was supposed to take place.
Organisers said the decision was a missed opportunity for Serbia to "prove that it is a country with the rule of law".
"This is pretty bad news for Serbia as it appears that human rights are not respected in the country," organiser Goran Miletic of the organisers told AFP.
Following the ban, a few hundred gay activists gathered before Serbian government building late yesterday carrying a huge banner that read "This is pride."
"We are not the ones who should be isolated nor the ones who should be removed from the street," Maja Micic of the organisers told reporters.
"We will have pride (parade) tonight and all 365 days until state institutions and this society are ready to deal properly with what we are talking about," she said.
Swedish Minister for European Union Affairs Birgitta Ohlsson, who was supposed to speak at the event, expressed "disappointment" at the ban.
The ban could hamper Serbia's EU membership talks that are expected to start by 2014.
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