"Worst President Ever" and "Four more years: God HELP America" were on some of the placards that the protesters carried on Capitol Hill on Thursday.
"It's important to show that when Bush's second inauguration goes into the record books, there was healthy dissent," said Jared Maslin, a demonstrator from New Hampshire.
The chants of the protesters came towards the end of the president's speech, and he continued his address without interruption or any sign that he heard them.
Bush chose to ignore the chants
of the protesters
Capitol Hill police detained some protesters and then released them after Bush finished speaking.
Earlier in the day, about 500 people rallied in a park several kilometres from the Capitol.
Capitol police spokesman Michael Lauer said officers had arrested five people for protesting.
An anti-war group called the Rhythm Workers Union banged on steel drums and danced in mud-caked boots.
More than 300 anti-war protesters, organised by CodePink, sported beauty pageant style banners with "resist" scrawled in black.
The coffin-like cardboard boxes that many protesters carried were draped in black cloth and the American flag to symbolise US soldiers and others killed in Iraq.
Protests were also staged around the world as Bush took the oath of office for the second term.
In Geneva, protesters read poetry. In London, they staged a candlelight march outside the US embassy.
"We elected a president who lied about weapons of mass destruction in Iraq. That really burns me up"
Protester Mark Miller
Across Europe, locals and American expatriates united in their opposition to Bush marked his inauguration with some unabashed Bush-bashing - complete with "Four Moron Years" buttons.
Protesters in Germany held a rally at Berlin's landmark Brandenburg Gate under the slogan: "You've Got a Voice."
In Prague, supporters of Senator John Kerry held what they dubbed the "What Might Have Been Inaugural Party" and in Geneva, there was a "Counter-Inaugural Dinner" kicked off with a reading of the Langston Hughes poem Let America Be America Again.
In southwestern France, Democrats Abroad screened a film called Bush's Brain.
"We elected a president who lied about weapons of mass destruction in Iraq. That really burns me up," lamented Mark Miller, an American who has lived in Austria for 26 years.
"Something has to be done to wake people up. Liberal is a dirty word right now, and that can't be."