About 200 members of the January 29 group rallied in front of Government House on Tuesday demanding the government release detainees in political cases and accept draft amnesty legislation to be submitted by several groups for consideration, reports said.
The members of the group, drawn from Bangkok and other provinces, began to gather at the Royal Plaza about 6am.
They set up a stage in front of the equestrian statue of King Rama VI and put up 18 tents for use by those taking part in the rally.
Members of the group were later joined by a large number of red-shirts and moved to Government House about 9.30am.
They planned to submit a draft constitutional amendment drawn up by the Nitirat Group, which includes provisions on amnesty for those who were involved in political protests, to Prime Minister Yingluck Shinawatra.
The January 29 group would then read out a statement demanding the release of both detainees and those convicted in political cases.
The rally was set to end about 10pm on Tuesday.
Traffic congestion was already evident around the Royal Plaza and Government House by lunch time.
Thida Thawornseth, chairwoman of the United Front for Democracy against Dictatorship (UDD), said the UDD had assigned Deputy Commerce Minister Nattawut Saikuar, a UDD leading member, to submit its draft of the amnesty decree to the prime minister today.
"The UDD does not expect the government to use its draft amnesty decree in its entirety. The draft may be subsequently altered," Mrs Thida said.
"Moreover, the UDD would have no objection if the government accepts for consderation the amnesty proposal of Ukrit Mongkolnavin, chairman of an independent committee for promotion of the rule of law," she said.
Deputy Prime Minister Chalerm Yubamrung said the January 29 group's rally was democratic and not outside the law.
He did not think the group was applying pressure on the government.