Hundreds of Mardi Gras protesters march down Sydney's Oxford Street after last-minute exemption

Hundreds of Mardi Gras protesters have marched down Sydney's Oxford Street after gaining a last-minute exemption.

Heath Minister Brad Hazzard granted organisers an exemption from the state's COVID gathering restrictions on Friday.

As a result, a court battle scheduled between NSW Police and organisers Pride in Protest did not go ahead.

Protest organiser Toby Walmsley said it was important Sydney's LGBTQI+ community gathered to make their voices heard.

"We have COVID safety marshals with hand sanitiser, a high level of mask usage. We were ready to administer this safely," he said.

"I'm here to fight against the religious freedom discrimination bill being pushed through Parliament, for the decriminalisation of sex work, for the end of black deaths in custody and for Black Lives Matter."

Mr Walmsley said Mardi Gras started as a protest in Sydney in 1978, so it was important to keep that "spirit of protest" alive.

"These are the issues that affect our community and this day, us marching down Oxford Street loud and proud is necessary to put those issues on the map and fight for our rights collectively," he said.

The city's official Mardi Gras celebration will be held at the Sydney Cricket Ground, with 36,000 people expected to attend.