Kasparov said it was the protesters who had decided not to march, despite the ban.
"We had to make the difficult choice of either pushing the crowds into the police ranks or asking them to walk away quietly, so we preferred the latter.
"We decided against having any clashes today," Kasparov said.
"If they are so confident, why are they scared of a few thousand people in a totally peaceful event?"
Garry Kasparov, 'Other Russia' leader
Security forces appeared to outnumber protesters, and in addition to regular police in short-sleeved shirts, hundreds of riot police waited in nearby buses.
Water cannons were also on standby, but kept out of sight of the protest.
"If they are so confident, why are they scared of a few thousand people in a totally peaceful event?" Kasparov asked. "The authorities are afraid of any organised protest."
St Petersburg rally
A similar demonstration of up to 3,000 people took place in St Petersburg, sanctioned by the police.
Opposition activists have said that authorities sanctioned protests to avoid clashes while the city was hosting an international investment forum.
"We need a new kind of politics in our country," said Viktor Gudymov, a chemical engineering student, who was attending what he said was his first opposition rally.
Deriding the rally as a "gathering of the insane", a group of pro-Putin activists dressed in medical gowns were led away from the rally by police.
A truck blaring taped laughter at high volume circled the venue to heckle the opposition speeches.
The Kremlin leader, who is due to stand down in 2008 at the end of his second term, promised to allow a fair contest both in parliamentary elections in December, and in the vote for a new president in March.
"Everyone will have the right to express their opinion," Putin said.