Waving black flags and carrying banners, thousands of neo-Nazis have marched in Dresden, marring the official 60th anniversary commemoration of one of the fiercest Allied bombing raids of World War Two.
Before the march on Sunday Chancellor Gerhard Schroeder pledged to stop far-right groups exploiting the anniversary and portraying Germany as a war victim while ignoring Nazi atrocities.
A Neo-Nazi lays down a wreath at the memorial for the victims of World War Two bomb raids at a cemetery in the eastern German city of Dresden
Police said at least 2,000 people joined the march.
Politicians voiced concern the march might turn into Germany's biggest far-right demonstration since the war - that neo-Nazis might clash with residents planning to turn out in their thousands wearing white roses in a counter-protest.
British, American, French and Russian dignitaries were due to attend events meant to send a message of peace and reconciliation, whilst remembering the crimes of the Nazis and those cities which shared Dresden's fate.
Official ceremonies began with a wreath-laying ceremony at a mass grave while neo-Nazis marched elsewhere in the city.
Dresden, untouched by bombing just months before the end of World War Two, was 85 percent destroyed by two waves of British bombers on the night of February 13th, 1945. US planes blasted the city the next day.
The official death toll is put at around 35,000 but many survivors believe the actual number was higher as bodies were reduced to ashes in the ensuing firestorm.
"Thousands of innocent people, including many children and refugees, died in most terrible circumstances," Mr Schroeder said in a statement today. "One of the most beautiful cities in Europe was destroyed. We mourn today for the victims of war and violent Nazi rule in Dresden, Germany and Europe."
Once dubbed the Florence of northern Europe for architectural jewels such as the Zwinger palace and the Semper Opera, the city was reduced to smouldering ruins.
East German socialist town planners restored some historic buildings but also tore vast concrete avenues through the city's heart. Today ugly concrete housing blocks jostle with church spires on the city skyline.
Dresdeners take huge pride in the baroque Frauenkirche, rebuilt in the 15 years since German reunification in 1990, and which was topped last year with a golden cross from Britain.
The anniversary has reopened a debate over how to mourn Germany's war dead while containing the resurgent far right.
Mr Schroeder pledged to counter all attempts to distort history and hinted he would make a fresh attempt to ban the far-right National Democratic Party (NPD) which helped organise the march.
"We will use all means to counter these attempts to re-interpret history. We will not allow cause to be confused with effect," he said. "This is our obligation to all the victims of the war and Nazi terror, especially and also the victims of Dresden."
Members of the NPD that sits in the Dresden-based Saxony state parliament provoked outrage last month by walking out of a commemoration of the liberation of Auschwitz concentration camp and calling the air raids a "bombing holocaust".