Security forces have said they will honour the right to gather for peaceful protest, but have set up roadblocks at all main access points to the capital, and have been stopping and searching cars.
On Tuesday the government invoked a security law to give the military special powers to restore order if necessary, with authority to ban gatherings and impose a curfew.
There were also reports that thousands of protesters were being turned away as they headed for the designated meeting points.
The red shirts include followers of Thaksin Shinawatra, the deposed Thai prime minister, and others who oppose the 2006 military coup that toppled him.
|Red shirt leaders have vowed to keep the protests non-violent [AFP]
The group argues that the current government of Abhisit Vejjajiva, the Thai prime minister, came to power illegitimately with the backing of coup leaders and the ruling elite.
The rally has been called two weeks after Thailand's top court confiscated $1.4bn of Thaksin's assets, frozen after the coup.
Authorities have warned of potential unrest triggered by the planned rally, citing the red shirts' last major protest in April last year, which descended into bloody clashes on the streets of Bangkok.
In that case the army was called in to quash the unrest which protest leaders later said had been instigated by hired pro-government thugs.
Organisers of the weekend rally have vowed to keep their protest non-violent saying they hope around 600,000 protesters will turn out.
They have accused the government of trying to create fear, and reiterated that they have no intention of occupying public or private buildings, including the two airports serving the capital.
Bangkok's Suvarnabhumi international airport, which was shut down by anti-Thaksin "yellow shirt" protesters in late 2008, has said it has contingency plans in place to deal with any attempts at disruption.
|Several countries have issued travel warnings to stay away from protest sites [EPA]
Nirandra Theeranartsin, the airport's general manager, said in a statement earlier this week that emergency measures were in place should the red shirts try to lay siege to the building as the yellow shirts did two years ago.
The Thai stock exchange said it too had prepared measures to ensure that business would not be disrupted.
"[We have] set up a special team to constantly monitor the situation as well as set up security measures for the building, its employees and the necessary infrastructure to ensure that trading and other significant systems will not be affected if the situation deteriorates," Patareeya Benjapolchai, the president of the exchange, said in a statement.
Several schools have said they planned to close on Friday and again next week depending on the circumstances, while the weekend's scheduled start of Thailand's national soccer league season has also been delayed.
Meanwhile tourists have been warned to avoid sites near the protests, with dozens of countries issuing some form of travel warning to their citizens.
A US advisory urged tourists to stay away from the protests where "violence cannot be ruled out", while Britain's warning described the Thai situation as "volatile" and asked travellers to "exercise caution at all times".
Earlier this week Abhisit cancelled a trip to Australia that coincided with the rally.
"Bangkok is in a jittery mood"
Sukhum Nuansakun, political scientist
He has warned that the rally could trigger incidents of "sabotage" but has advised against panic.
Abhisit and his deputy, Suthep Thaugsuban, will be based at a temporary military command centre during the protest.
"If there is a siege, we would no longer consider it a peaceful protest and immediately take steps to disperse the crowds," Suthep told reporters on Thursday.
Despite the increased security presence, many offices, businesses, and schools near key protest areas are worried about violence.
"Bangkok is in a jittery mood but it doesn't necessarily reflect what would come to pass," Sukhum Nuansakun, a political scientist, told Reuters news agency.
"There is a lot of conjecturing and posturing on both sides which raise concerns about what is next."