Vladimir Ilyich Lenin was knocked from his pedestal, smashed into pieces by mallet-wielding men and carried off in hundreds of small granite chunks in Kiev after hundreds of thousands of Ukrainians took to the streets in the latest display of anger at President Viktor Yanukovich's rejection of closer ties with Europe.

"This is the great Ukrainian revolution," screamed a man who had scrambled to the top of Lenin's former pedestal to plant Ukrainian and EU flags, as the crowd below shrieked approval, sang the Ukrainian national anthem and scrambled to gather souvenir chunks of the Bolshevik leader.

"Of course it would have been nice to have got rid of it in a more civilised way," said 36-year-old Mykola Boiko, clutching an apple-sized chunk of Lenin's body. "But he was a mass murderer. It's like having a monument to Hitler in your city. I'm glad he has gone."

Lenin's severed head reappeared after several hours at the pedestal, where protesters photographed it before a group of youths attacked it with hammers. "We are not against the Russian people, we are against Lenin and Putin," shouted one young protester before attacking the head with a huge mallet. The granite proved resistant although Lenin's facial features were damaged and one man pocketed an eyebrow. Shortly after, the head was rolled to a pickup truck and driven away.

Anti-government protesters gather for a massive demonstration in Independence Square on 8 December 2013 in Kiev, Ukraine. Photograph: Etienne De Malglaive/Getty Images

Earlier, the opposition threatened to march on the presidential palace and seal Yanukovych inside if he did not sack his prime minister within 48 hours.

Hundreds of thousands of people crammed into Independence Square and nearby streets on Sunday, chanting "Ukraine is Europe!". They called on Yanukovych to resign in the biggest protest of a two-week movement to force the president to reverse a decision to halt European integration.

The protesters carried the yellow-and-blue flags of both Ukraine and the European Union. Although some protesters also waved flags of political parties, the majority of those on the streets were not supporters of particular groups.

One man wielded an effigy of the severed head of the late Libyan leader Muammar Gaddafi above a sign reading: "Vitya [Yanukovych], the game is over!"

"We do not want to be kept quiet by a policeman's truncheon," heavyweight boxer and opposition leader Vitali Klitschko told the crowd.

Opposition leader Vitali Klitschko addresses the crowds in Kiev's Independence Square. Photograph: Sergei Supinsky/AFP/Getty Images

Since last Sunday, when protesters attempted to storm the presidential offices and riot police responded ruthlessly, there have been no violent clashes. The government has so far taken a hands-off approach to the protests but resisted concessions.

The prime minister, Mykola Azarov, survived a no-confidence vote in parliament on Tuesday and branded those on the square "Nazis and criminals", but after Sunday's violence increased the protest mood, police withdrew from the city centre. On Friday, however, police said that if two occupied buildings, including City Hall, were not vacated within five days, they would be cleared by force.

On Sunday, Eduard Leonov, an MP from the nationalist Svoboda party, was sitting at a desk inside City Hall marked "Committee for the self-government of Kiev", and described himself as the commander of the building.

He said protesters would not acquiesce to the police demands.

"First, it's an illegal order, as MPs have the right to hold meetings wherever they want. Second, it's an immoral order, as this is a humanitarian mission providing food and warmth to the protesters."

Hundreds of mattresses had been laid out on the floor in City Hall's main colonnaded room, and stalls handed out food, medicine and donated warm clothes.

"If the government decides to storm the building, then of course we will resist," said Leonov.

Across town, a low-key rally of pro-Yanukovych Ukrainians was guarded by hundreds of riot police. The crowd stood unenthused as pop music blared and a voice boomed from a loudspeaker that opposition forces were attempting to launch a coup d'etat. Many admitted they had been bussed into the capital from the Russian-speaking east of the country, and most did not look happy to be there.

A placard makes protesters' feelings clear in Kiev's Independence Square. Photograph: Etienne De Malglaive/Getty Images

Yanukovych has kept a low profile since the protests started, even flying to China for a three-day trip last week as the centre of Kiev remained under siege. He returned to Ukraine on Friday, stopping over in Russia to meet Vladimir Putin, with rumours circling in Kiev that the pair had agreed for Ukraine to join the Russian-led Customs Union. That sparked fury in Kiev but was denied by spokespeople for both presidents.

Russia and the west have traded allegations over which side is putting pressure on Ukraine. On Saturday, former Georgian president Mikheil Saakashvili told the crowd on Independence Square that Putin had performed a "raider attack on a whole sovereign country", attempting to steal Ukraine's fate from its own people.

Alexei Pushkov, the head of the Russian parliament's foreign affairs committee, struck back: "Saakashvili is kind of right. There is an attempted raid on Ukraine, not from Moscow but Brussels, grabbing it by the neck and dragging it to paradise," he tweeted. "The word 'paradise' should be in inverted commas, of course. For Bulgaria, Greece and even for Serbia which is just an EU candidate country, the promised 'paradise' turned to hopeless gloom."

Protesters cover a Christmas tree in Kiev with EU and Ukranian flags. Photograph: Maxim Golubchikov/Demotix/Corbis

Yanukovych has insisted he still wants integration with Europe, but could not sign the EU deal as it would have caused further damage to Ukraine's suffering economy.