The rally was led by the National Union of Metal Workers of South Africa (NUMSA), which has become a powerful voice of opposition to President Jacob Zuma and the ruling Africa National Congress (ANC) party.
Banners held by demonstrators read "Away with corruption. Away with Zuma government" and "Corruption taxes the poor. We say tax the rich."
"We see a very direct relationship between corruption and the state of our economy, which results in us losing jobs in the thousands," Zwelinzima Vavi, one of the organisers, told cheering crowds.
According to the latest International Monetary Fund forecasts, economic growth will fall to just 1.4 percent this year in South Africa and will decline again next year.
A tumbling rand and unreliable electricity supplies have added to the country's woes, with business confidence now at its lowest level since the end of apartheid in 1994.
Zuma's private residence has become a symbol of alleged government misspending after $24 million (21 million euros) was used on "security" improvements to the sprawling homestead.
"We used to think he is the guy who would liberate us, the poor. But he decided to become a thief."
Zuma led the ANC to an easy victory in last year's general election, but could face defeats in several cities at municipal elections in 2016.
Last week, he admitted that the party was seen as having a corruption problem and was losing support after being in power since 1994.
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