By Al-Zaquan Amer Hamzah and Trinna Leong
KUALA LUMPUR (Reuters) - Malaysia's former leader Mahathir Mohamad made a surprise appearance on Saturday among tens of thousands protesting to demand the resignation of the prime minister over a multi-million-dollar payment into an account under his name.
The rally in Kuala Lumpur brought into the streets a political crisis that has raged since reports in July that investigators probing the management of debt-laden state fund 1MDB had discovered the transfer of more than $600 million.
Prime Minister Najib Razak, who denies wrongdoing, has weathered the storm and political analysts doubt the two-day rally will force him out of power.
However, the brief evening appearance of the deeply respected 90-year-old Mahathir, once Najib's patron and now his fiercest critic, thrilled the protesters and could add momentum to their anti-government movement.
Security was tight and anti-riot trucks and a water cannon were parked near a square where protesters had planned to converge. In the end, they hung back behind barricades.
Pro-democracy organization Bersih, which organized the rally in Kuala Lumpur and the two main cities on Malaysia's side of Borneo, said the crowd in the capital swelled to 200,000 at its peak. The Malaysiakini news portal put the number at half that and police said it was just 25,000.
There were no reports of violence and the mood was festive during the day as protesters - some with placards reading "Out, Najib, Out" - blew plastic horns and shouted "bersih!", a Malay word for "clean".
"We the Malaysians want to clean up this country, we reject dirty politics," said Tinagar Veranogan, a demonstrator in a crowd mostly made up of young people from the ethnic Indian and Chinese minorities.
City authorities rejected an application by Bersih for a protest permit, raising fears of a repeat of a 2012 rally when police used water cannon and tear gas to disperse protesters.
The government blocked access to Bersih's website and banned the wearing of its signature yellow T-shirts, but the crowd of protesters was a sea of yellow.
"For 58 years people have been patient with bribes, a political system that cannot resolve 1MDB. Today we want reform," said Bersih leader Maria Chin, calling on parliament to hold a vote of no confidence in the prime minister.
The second day of the rally on Sunday is due to start with physical exercises, mass at a cathedral and interfaith prayers.
"HUGE FRUSTRATIONS"
"There are huge frustrations with a number of endemic rights issues in Malaysia at the moment - the crackdown on freedom of expression by the government must end," Josef Benedict, Amnesty International's deputy campaigns director, said in a statement.
Najib was not in Kuala Lumpur. The Bernama national news agency quoted him as saying from the eastern state of Pahang that the patriotism of the rally organizers and participants was "shallow and poor".
Analysts say the Bersih movement is unlikely to inspire broad public support because it lacks strong leadership.
Ibrahim Suffian, director of independent pollster Merdeka Center, said discontent with Najib, who took office in 2009, is concentrated in urban areas and a national survey this month by his group showed a slight majority opposed the rally.
Malaysia's anti-graft agency has said the funds paid into Najib's account were a donation from the Middle East, which came just before a 2013 election. The identity of the donor has not been revealed.
Najib, 62, says he did not take any money for personal gain.
He has sacked his deputy and other ministers who publicly questioned him, and the attorney-general who had been investigating 1MDB (1Malaysia Development Berhad) has been replaced.
Authorities have also suspended two newspapers and blocked access to a website that had reported on 1MDB.
Najib retains significant support from the long-ruling Barisan Nasional coalition and from his party, the United Malays National Organisation that represents the Malay majority.
The coalition, in power since 1957, lost the popular vote for the first time in 2013 to an opposition alliance that split this year.
Mahathir, Malaysia's longest-serving prime minister, withdrew support for Najib last year.
The prime minister has accused his former patron of stoking corruption allegations against him, saying this began when he refused to implement Mahathir's demands.