Police said 45,000 people were taking part in the march which wound from Hyde Park Corner past the US embassy to a rally in central London's Trafalgar Square.
Organisers, the Stop the War Coalition, said they hoped that eventually 250,000 people would join the march, one of many being held around the country and across the world to mark the second anniversary of the Iraq invasion.
"It is peaceful. There have been no incidents and no arrests," a police spokesman said.
The protesters placed a black cardboard coffin with the slogan "100,000 dead" scrawled across the daffodil-strewn lid against a tree outside the US embassy.
As the coffin was laid down, the crowd chanted: "George Bush, Uncle Sam. Iraq will be your Vietnam."
A coffin was placed in front of
the US embassy in London
The organisers said they had tried but failed to deliver a letter to the embassy insisting that Bush and his ally British Prime Minister Tony Blair to pull their forces out of Iraq.
"We demand that you set an early date for the swift withdrawal of our troops from occupied Iraq as the Italian government has been forced to do and restore full and unconditional sovereignty to the Iraqi people," the letter said.
Troop pullout demand
Italy, Ukraine, Poland and Bulgaria have recently signalled they were eager to scale down their presence in Iraq.
The United States has about 150,000 troops in Iraq, the biggest contingent in the country, while Britain has the second largest with 8600.
Blair said on Wednesday he had no intention of an early withdrawal of British troops.
Protests took place in capitals
across the world
The Stop the War letter also called for an end to support for Israel's occupation of the West Bank and Gaza.
Blair, expected to call a general election within two months, has seen his once sky-high popularity plummet since the deeply unpopular invasion in March 2003 and an ensuing series of revelations on how the case for war was exaggerated.
The final grudging admission that Saddam Hussein did not have any of the feared weapons of mass destruction which formed the backbone of the case for war, as well as daily pictures of death and destruction has kept Iraq in the headlines.
At least one million people marched through London in February 2003 to protest against the imminent invasion of Iraq.
Stop the War said it wanted to make sure that the invasion and occupation would be a feature of the election, widely expected to be called for 5 May and which Blair's Labour Party is expected to win - albeit with a reduced majority.