'Racism and agitation'
The counter-demonstration by hundreds of left-wing protesters, members of church groups, trade unions and the Green party came after about 200 people turned out for the Pro Klein rally.
"Today we're sending a signal that democrats stand united against right-wing radicalism, racism and agitation," Reinhard Bütikofer, the former head of the Green party, said.
Police had earlier banned Pro Koeln and Pro NRW, an allied group, from holding its demonstration in front of the Cologne cathedral in the city centre, and allowed them to assemble at a square in the Deutz district.
A march planned by right-wing groups to the site of the planned mosque on Sunday has also been banned.
The march had been expected to mark the culmination of a three-day "convention" to oppose the construction of mosques and immigration of Muslims to Germany.
Germany is home to three million Muslims, who make up four per cent of the country's population.