A procession of yellow umbrellas -- the symbol of the city's democracy movement -- moved through the city's downtown with protesters carrying signs reading "fight for the freedom of the next generation" and calling for the resignation of officials who "sold out" the city.
Leading the protest was a large replica of a white elephant with a model of the city's unpopular leader Leung Chun-ying riding it, symbolising expensive public projects.
AFP journalists at the scene estimated the crowd at around 1,000 people, while organisers said more than 3,000 people took part in the protest. Police did not immediately provide an estimate.
Negative sentiment remains high against authorities after mass pro-democracy rallies calling for free leadership elections in 2014 brought no concessions on political reform from Beijing and Hong Kong authorities.
"It's really for the next generation, they deserve a better Hong Kong," pro-democracy lawmaker Claudio Mo, who participated in the rally, told AFP.
Cost estimates for that project have risen by more than 30 percent to HK dollar 85.3 billion (USD 11.01 billion) in recent years, and the completion date repeatedly pushed back.
"We would like Leung Chun-ying to step down and hold this march so he can hear what we want and know what he has done wrong," Match Ip, a 19-year-old university student told AFP.
Yesterday, Hong Kong University students and alumni voiced fury after a pro-Beijing official was appointed to a senior role at the university, as tension mounts over what critics see as political interference in the city's education system.
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