Tens of thousands of protestors took to the streets of Hong Kong Sunday, adamant there was nothing to cheer as the former British colony marked 15 years of Chinese rule and swore in a new leader.

The rally came after Chief Executive Leung Chun-ying, a millionaire property consultant seen as close to China's communist rulers, took his oath before Chinese President Hu Jintao -- whose speech was interrupted by a demonstrator.

Hu's visit and Leung's inauguration have become focal points for growing discontent towards Beijing, which has surged to a new post-handover high amid soaring housing costs, limited democracy and perceived meddling by China.

The marchers -- young and old, mostly clad in the mourning colours of black and white, and ranging from engineers to maids -- mustered in a large park, and many were still gathered waiting to set off an hour after the vanguard left.

"Hong Kong has become much worse off," Eric Lai of the Civil Human Rights Front told the protestors. "Our rights are under serious threat."

The financial centre enjoys significant autonomy and civil liberties unheard of on the mainland under the "one country, two systems" model set up when it returned to China in 1997 after more than a century of British rule.

But marcher Jacky Lim, 37, who carried Hong Kong's former colonial flag bearing the British union jack, said: "There is nothing worth celebrating today. Hong Kong is being gradually destroyed by the Communist Party.

"The direct interference of Beijing in the election of Leung Chun-ying is a clear example," he said.

Hong Kong does not yet choose its leader by universal suffrage, and Leung was elected as chief executive in March by a special committee stacked with pro-Beijing business elites.

Earlier, as President Hu began his speech to around 2,300 guests at Leung's inauguration, a protestor inside the harbourfront convention hall venue repeatedly shouted "End one-party rule".

The man also referred to the crushing of democracy protests on Tiananmen Square in Beijing on June 4, 1989, and was rapidly bundled away by security personnel, while the audience drowned him out with extended applause for Hu.

Beijing's support for "one country, two systems" and the right of the people of Hong Kong to rule the territory was "unwavering", said Hu.

"We will follow the Basic Law... to continue to advance democratic development in Hong Kong," said the president, who will step down as part of a once-in-a-decade leadership transition in Beijing starting later this year.

Hu -- who said Friday he hoped to "walk more" and understand Hong Kongers' "life and expectations" -- left for Beijing before the march began.

Stifling security was imposed for his three-day visit.

Anger has been heightened by the death of leading dissident Li Wangyang, whose body was found in his hospital ward in China in June in what his family say are suspicious circumstances.

On Saturday police had used pepper spray to push back a few dozen protestors who tried to get past barricades near Hu's hotel, and a Hong Kong reporter was briefly detained by police after shouting a question about Tiananmen at Hu.

China's economic rise has helped spur impressive growth in Hong Kong and boost the city's status, and a stadium was packed Sunday for a gala featuring a People's Liberation Army parachute display.

"I came here to celebrate the handover," said Vincent Wong, 35, a construction worker. "As a Chinese person I am very happy."

Nonetheless tensions are growing between the seven million locals and their northern neighbours.

Hong Kongers accuse newly rich Chinese mainlanders of everything from pushing up property prices to monopolising school places and maternity beds.

A poll released by Hong Kong University last week showed mistrust towards Beijing at 37 percent, a post-handover high, and the number of Hong Kongers identifying themselves primarily as citizens of China plunged to a 13-year low in another survey.

Discontent against the local authorities is also intense. Ahead of Leung's swearing-in, a group of demonstrators burned his portrait, shouting: "Battle the Communist Party! We will battle to the end!"

The new chief executive takes over the city at a time of complaints about a widening gap between rich and poor. Home ownership has spiralled out of reach for many, and he has promised to tackle the grievances.

"If we work together, I am sure Hong Kong -- the Pearl of the Orient -- will sparkle again," Leung said in his speech.