The protest was peaceful until a small group of demonstrators tried to break through the lines of riot police.
Reports say opposition activists Alexei Navalny, Sergei Udaltsov and Boris Nemtsov have all been detained.
A rival demonstration in support of Mr Putin has also been taking place.
Organisers said about 20,000 people took part in the opposition march - to an island close to the Kremlin - although police put the figure at about 8,000.
Police have been blocking the protesters from crossing a bridge over the Moscow River.
Clashes broke out when more people crowded towards the bridge and riot police wielding batons pushed demonstrators back towards the rally site, witnesses said.
Protesters launched a sit-in by the police lines.
They were refusing to leave unless Mr Putin's inauguration was cancelled. They were also demanding an hour of TV airtime and new elections, our correspondent says.
Dozens of protesters are said to have been arrested.
TV images then showed police storming the stage of the rally where left-wing activist Mr Udaltsov had been addressing protesters, and taking him to a waiting vehicle.
Before he was seized, Mr Udaltsov had called for the inauguration to be cancelled and said through a loud-hailer: "We will not leave."
The crowd chanted back: "We are the power."
Russia's Interfax news agency later reported that Mr Navalny - an anti-corruption blogger and nationalist - had been arrested and Dozhd TV tweeted that liberal politician Mr Nemtsov had also been detained at the rally.
Source: BBC News
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