The crowd held banners calling for national unity, and chanted slogans hailing the young Iraqi Shia leader Muqtada al-Sadr, describing him as a national leader.
In an interview with Aljazeera correspondent Udai al-Katib, Shaikh Abd Allah al-Janabi, head of the Shura Council of Mujahidin, accused the US-led occupation of a "dirty tricks campaign".
Al-Janabi said occupation forces were trying to initiate an internal Iraqi conflict by holding Fallujans responsible for the deaths of six Iraqi Shia Muslim drivers earlier this month.
"We in Falluja have nothing to do with their deaths. As for the allegation of mutilating the bodies of the drivers, I assure everyone that this never happened," Shaikh al-Janabi said.
An investigation carried out by the Coalition Provisional Authority (CPA) and US marines proves Falluja's innocence, according to the city's deputy governor.
Shura council chief Al-Janabi: We
shall not fight our countrymen
"CPA officials and investigators from the US marines went to Ramadi (capital of Anbar governorate which includes Falluja) and inspected police records and the city's morgue, but did not find evidence against the Falluja people," Mahmud Ibrahim al-Juraisi said.
A number of protesters told Aljazeera's correspondent that nothing would deflect them from their faith and commitment to national unity.
The protesters in Falluja rejected the US claim that Saturday's air raid on their city targeted an alleged safe house of Abu Musab al-Zarqawi. The attack claimed 22 lives.
Abd Al-Hamid al-Falluji, preacher of al-Furqan mosque, told the crowd Falluja is strong enough and does not need to harbour al-Zarqawi.
"Falluja does not need al-Zarqawi to defend it. Everybody knows that Falluja's men love to die for God's cause as much as the infidels love to live," al-Falluji said.
Iraqi interim prime minister, Iyad Allawi, defended the US strike. However, Iraqi officers belonging to the battalion entrusted by the US occupation forces to keep law and order said the dead consisted mostly of women and children and no foreign fighters.