The annual parade started at noon in Centenary Square, following a free community event on Friday on the main stage at Smithfield.
The Sugababes will headline on Saturday, with other performers including Cat Burns, Samantha Mumba and RuPaul's Drag Race UK winner Danny Beard also featuring.
Birmingham Pride is across two sites and six stages.
Now in its 26th year, organisations taking part in the weekend-long festival include West Midlands Police and NHS trusts from across the region.
Sarah Lawson, head of inclusion at University Hospitals Birmingham, said more than 200 NHS staff would be marching together with pride, accompanied by drummers and samba dancers.
"We want to make sure that everybody knows that the NHS is inclusive and welcomes absolutely everybody," she said.
Sarah Anderson from Proud Baggies, West Bromwich Albion's LGBTQ+ supporter group, said the event was "fabulous" and an opportunity to celebrate.
"[Fans are] coming to matches as their true selves because of us and because of what we've done, so we're really proud of that," she said.
West Midlands Police, which is also taking part in the parade, said its Rainbow Streetwatch patrols would be out and about during the event.
Gabrielle and B*Witched will be among those appearing on Sunday, along with APW, who said Pride was "such a massive thing for me".
He added: "R&B kind of pop soul stuff isn't always at the front and centre of the gay community.
"So it's nice to kind of push that and share that with everyone.
"Pride is visibility. It's about being able to see yourself in a positive way and see a future.
"That's what Pride is to me."