The celebration was tempered by the knowledge that other states, including Massachusetts, Connecticut and Iowa, have legalized same-sex marriage before New York.
"Hopes and dreams and expectations have been raised, and there is nothing worse than to for people to have their hopes die out, to have the rug pulled out from under them," said City Council Speaker Christine Quinn, New York City's most prominent openly gay elected official.
Gov. David Paterson said he remains hopeful that the state Senate will pass a same-sex marriage bill - if it can resolve the partisan stalemate that has paralyzed it.
"If we have an end to the stalemate in Albany I would think that it would be passed shortly after," he said. "We believe we can pass the bill."
This year's march featured the usual mix of seasoned activists, dazzling drag performers and floats blasting disco beats.
A faux Liza Minnelli in a slinky dress and spiky wig lip-synched "New York, New York" atop the Stonewall Inn float.
The Lesbian, Gay, Bisexual and Transgender Community Center's float was sponsored by the Broadway musical "Shrek," whose ogres-need-love-too message was apparently a good fit.
Flavia Rando marched with the Gay Liberation Front, which began in 1969 after the Stonewall uprising.
"It feels like we changed the world," Rando said. "We started a global movement."
In addition to Paterson, one of the parade's grand marshals, elected officials marching included Mayor Michael Bloomberg and Sen. Charles Schumer.
Parade organizers claimed as many as 500,000 participants. That number was difficult to verify, but many thousands marched or lined Fifth Avenue to watch.
Spectator Mark Jester of Denton, Md., visiting New York for the first time, said the parade was "awesome," especially the drag queens.
"I have a lot of respect, because if I would do that at home I literally would have to fight," he said.
Danielle Staub of the Bravo reality show "The Real Housewives Of New Jersey" marched in heels that rivaled a drag queen's and said gay people deserve the right to marry.
"My two marriages didn't last as long as most of the gay community's partnerships," she noted.
As part of the yearlong celebration of the 400th anniversary of the Dutch encounter with New York, Amsterdam officials held a contest for couples to marry in that city, where same-sex marriage has been legal since 2001.
The winners, five couples with one Dutch partner and one American partner, will travel to Amsterdam for its August gay pride celebration and get married there.
"We kept saying we were going to do it here once it was legal in New York state," said contest winner Stephan Hengst, who was born in the Netherlands and now lives in Highland, N.Y., with his partner Patrick Decker. "We hope to see it become legal in New York very soon."
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