The demonstration is the latest in a series of White House protests aimed at convincing U.S. President Barack Obama to thwart Calgary-based TransCanada's attempts to build the Keystone XL pipeline that would carry Alberta oilsands crude through six American states to Gulf Coast refineries.
Mark Ruffalo, nominated for an Academy Award last year, and Jody Williams, winner of the 1997 Nobel Peace Prize for her work on banning landmines, were among a sea of protesters who marched along several downtown blocks, including past the U.S. Treasury building, before surrounding the White House in a mammoth circle.
Bill McKibben, a leading U.S. environmentalist and one of the protest's organizers, described the scene as both "a big O-shaped hug" or "a symbolic house arrest."
Obama, however, was golfing in northern Virginia for most of the afternoon. His motorcade arrived back at the White House just before 5 p.m. without any interference from the protesters.
"I have heard he's gone golfing but he has to drive through the wonderful circle to get back to his house, so that's perfect," Canadian actress Margot Kidder, who was arrested at a similar White House protest in August, said earlier on Sunday.
Ruffalo was on hand to address the protesters before they began their march, some of them carrying a giant fake pipeline emblazoned with the words Stop The XL Pipeline.
"I'm here to get a message to President Obama to stop the tarsands Keystone XL pipeline," Ruffalo told The Canadian Press before he took to the stage in a park across Pennsylvania Avenue.
"I voted for him because he promised us change and he promised us we were going to be the generation to end tyranny, and now is his chance to come through."
Police on the scene estimated the crowd at about 5,000-strong while organizers claimed as many as 12,000 people were on hand at the peak of the protest.
The Obama administration is currently weighing whether to give the green light to Keystone XL.
The U.S. State Department is making the ruling because the pipeline crosses an international border, but the president has said the final decision will reflect his views and suggested he isn't swayed by the argument that the pipeline will create thousands of jobs.
"Folks in Nebraska, like all across the country, aren't going to say to themselves, 'We'll take a few thousand jobs if it means our kids are potentially drinking water that would damage their health,"' Obama said in a recent interview with an Omaha TV station.
"We don't want, for example, aquifers to be adversely affected. Folks in Nebraska obviously would be directly impacted."
A decision on the pipeline was supposed to be made by the end of the year, but the State Department suggested last week that it might defer the decision as they continue to assess whether Keystone XL is in the national interest of the United States.
Keystone XL has become a political hot potato for the Obama administration, especially since the release of emails that suggest a cosy relationship between State Department officials and TransCanada's chief lobbyist, Paul Elliott. Elliott worked on Secretary of State Hillary Clinton's unsuccessful presidential bid in 2008.
There have also been allegations that the State Department failed to do an impartial environmental assessment of Keystone XL by hiring an environmental consulting firm, Houston-based Cardno Entrix, recommended to it by TransCanada itself.
With a presidential election less than a year away, key Obama advisers are reportedly growing increasingly nervous about losing supporters if they approve Keystone XL.
The pipeline's opponents point to spills along oil pipelines and argue the Keystone XL project is a disaster waiting to happen since it would carry millions of barrels a week of carbon-intensive oilsands crude through environmentally fragile areas of the U.S. Great Plains.
Proponents, meantime, say the pipeline will create thousands of much-needed jobs and help end American reliance on oil from volatile and sometime hostile OPEC regimes.
The project has not only become a symbol of the increasingly heated debate in the United States about the country's reliance on fossil fuels and a perceived reluctance to embrace renewable sources of energy. It's also tapping into growing American distaste for big corporations amid the continuing Occupy Wall Street protests.
Pipeline opponents have said their anti-Keystone protests reflect widespread public anger at corporate greed, pointing to the Occupy Wall Street demonstrations.
"You can't occupy the White House, but you can surround it," McKibben told a news conference last week.
Michael Brune, the executive director for the Sierra Club, urged Obama to block the pipeline as he addressed Sunday's protesters.
"President Obama can reignite the passion of Americans who care about clean air and clean water if he stands up for the health and livelihood of America's heartland, takes a stand against this climate catastrophe, and rejects this pipeline," Brune said.
"Denying the Keystone XL permit will send a clear signal that the U.S. government recognizes our true 'national interest' before oil company profits."
TransCanada responded to the White House protest in a statement released Sunday afternoon.
"What these millionaire actors and professional activists don't seem to understand is that saying no to Keystone means saying yes to more conflict oil from the Middle East and Venezuela filling American gas tanks," company spokesman James Millar said.
Millar added: "After the Washington protesters fly back home, they will forget about the millions of Americans who can't find work."
Keystone XL has galvanized the environmental movement in the U.S. following last year's failed federal climate change legislation. More than 1,000 protesters were arrested this summer in two weeks of sit-ins outside the White House.
The Nebraska legislature, meantime, is in special session considering legislation that could force TransCanada to reroute the pipeline away from the Ogallala aquifer, a major source of drinking water for the region.