By Michael Gold

TAIPEI (Reuters) - Tens of thousands of demonstrators, many displaying rainbows and glitter, thronged the center of Taiwan's capital on Saturday to press demands to legalize same-sex marriage amid an increasingly tolerant environment on the island nation.

Organizers and participants said they were heartened by the prospect of same-sex marriage becoming a reality, despite enduring traditional attitudes among many residents.

Taiwan's legislature on Friday began a review of a gay marriage bill, which has the support of 53 percent of the public, according to a recent opinion poll, though acceptance of a gay family member remains low.

"Chinese families are still very traditional," said Jennifer Lu of the counseling group Taiwan Tongzhi Hotline Association and one of the hosts on the center stage. "People still emphasize having an heir and passing on the family name."

On a cool autumn day, the 11th annual parade was marked by colorful costumes, plenty of exposed skin, musical performances and vendors lining the route to and from the city hall.

Spokeswoman Meico Tsai praised the liberal attitudes that have put Taiwan far ahead of its neighbors in terms of tolerance of gays. "Compared to other Asian countries, we're more open, but we still have a long way to go," she said.

Sexual-orientation education is a part of the primary school curriculum and LGBT individuals enjoy legal protection from hiring discrimination and other forms of prejudice.

"Korea is much more conservative," said South Korean national Carmen Yoon, a first-time attendee. "I hope Taiwan will legalize gay marriage and we can follow their example."

Taiwan, where Chinese nationalist forces fled after being defeated by the Communists in 1949, is a self-governing nation that is claimed by China. A former dictatorship, it underwent a peaceful transition to democracy in the 1980s and has developed one of the most thriving civil societies in Asia.

Mainland China maintains a largely indifferent attitude toward LGBT issues as cities boast thriving yet underground gay cultures. Legal protections are virtually nonexistent and though gay marriage has been proposed in Beijing's rubber-stamp parliament, it has never been placed on the agenda.

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New Zealand became the first country in the Asia-Pacific region to permit same-sex marriage this year and the Australian Capital Territory approved the measure this week.

Neil Peng, co-writer of "The Wedding Banquet", an early film focusing on a same-sex relationship, said Taiwan's gay community had been helped by uncensored discussion in the arts.

He pointed to the effect throughout Chinese-speaking countries of the best-selling book "Crystal Boys".

"These kinds of works force people to face facts," he said.

(Editing by Ron Popeski)