Thousands of people brought Melbourne's CBD to a standstill on Friday, rallying against the closure of remote indigenous communities.

The intersection of Flinders Street and Swanston Street was blocked for about two hours by sitting protesters until the area re-opened to trams and cars around 7pm.

Protesters hold banners aloft as they march through the streets of the Melbourne CBD. Credit:Scott Barbour

A large banner saying "Shut Down Melbourne" was strung between a set of traffic lights, while a campfire lit in the centre of the intersection covered the area in eucalyptus leaf smoke.

Organisers set up a sound system in the intersection and a stream of activists addressed the large crowd, which spilled out onto the steps of St Paul's Cathedral and Flinders Street Station.