Police have put the figure at 100,000, while Israeli media have estimated around 180,000 people in attendance.
Large sections of Tel Aviv have been shut for traffic, with streets packed people waving rainbow flags and dancing. The theme of this year’s parade, which was the city’s biggest ever, was “Tel Aviv loves all genders”.
Among the visitors include Conchita Wurst, the bearded Austrian cross-dresser who won last year’s Eurovision song contest.
Israel has emerged as one of the world’s most gay-friendly travel destinations, in sharp contrast to the rest of the Middle East where gay culture is not tolerated and LGBT people are persecuted and even killed. Same-sex relations are punishable by death in Iran, Mauritania, Saudi Arabia, Sudan and Yemen. Gay people serve openly in Israel’s military and parliament, and many popular artists and entertainers in the country are gay.