Azerbaijan, a former Soviet republic, wants to use the Eurovision contest to highlight the progress the oil-producing nation of nine million people has made since independence in 1991, while critics of the government are using the huge interest in the event to air allegations of human rights abuses.
Around 40 protesters gathered near the presidential administration in the glistening city centre, decorated for the May 26 song contest, where uniformed and plainclothes police officers pushed some of them onto what looked like city buses.
Other marchers, part of a movement that has been staging an increasing number of anti-government demonstrations, chanted "Resign!"
Baku, under fire over its rights record, dismissed recent accusations by rights groups Amnesty International and Human Rights Watch that it tramples on freedom of expression.
"We know the image and strength of these organizations but they are losing the trust of our society," said Ali Hasanov, head of the public and political issues department at the presidential administration.
"Their conclusions do not correspond with the reality" and their statements are "anti-Azeri propaganda", he told a news conference.
Critics accuse Ilham Aliyev, who succeeded his father to the presidency of the Caspian Sea country north of Iran, of clamping down on dissent, but Baku says the country enjoys full freedom of speech and a vibrant opposition press.
Rights groups urged the authorities last week to release jailed opposition activists and guarantee freedom of expression for protesters taking part in peaceful demonstrations before the contest.
"When viewers across the world tune in for the Eurovision this month, the most convincing way for Azerbaijan to present itself as a modern, progressive nation will be for the authorities to end their ongoing crackdown on freedom of expression," John Dalhuisen, Amnesty International's Europe and Central Asia director, said in a statement last week.
Baku has stepped up security throughout the city, citing the danger of attacks by Islamist fundamentalists.
A group of hackers, calling themselves Cyberwarriors for Freedom, attacked the official websites of the Eurovision song contest last week, demanding that Azerbaijan cancel the competition and comparing it to a "gay parade".
Azerbaijan won the right to host the contest by winning last year's event in Germany with the love song "Running Scared".
(Writing by Thomas Grove and Margarita Antidze; Editing by Tim Pearce)
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