The unsanctioned protest came hours after Alexei Navalny, the anti-corruption campaigner and chief foe of President Vladimir Putin, was found guilty of fraud and given a suspended sentence of three and half years. His brother was sent to prison.
The convictions are widely seen as a political vendetta for Navalny's role as a leading opposition figure.
Navalny, who has been under house arrest since February, broke its terms to attend the rally and was rounded up by police as he approached the site of the protest. Moscow police said he would be driven back home, but that claim couldn't be independently confirmed.
The protesters, who gathered on the square, chanted: "We are the power!" and "You won't be able to jail us all!"
Alexei Mayorov, a security official in the Moscow mayor's office, had warned that any attempt to hold a rally would be quickly blocked, and the police immediately took action.
The provocateur punk group Pussy Riot had released a video supporting today's demonstration, featuring four stylishly dressed women sweeping snow from the square, then mounting their brooms and flying off as witches across the Kremlin wall in a performance symbolizing protest.
Two of the performers, Nadezhda Tolokonnikova and Maria Alekhina, spent nearly two years in prison on charges of hooliganism for mounting an anti-Putin protest in Moscow's main cathedral in 2012, and won global fame.