Tahir Elci was killed on Saturday as he made an appeal for peace between the security forces and Kurdish rebels.
His death sparked instant protests across Turkey.
Crowds chanted “the martyr does not die” as his coffin was carried through the streets of Diyarbakir.
Mr Elci was killed in a gun battle between police and unidentified gunmen. Two police officers also died.
It is not yet clear whether he was caught in crossfire or the victim of a planned assassination.
Thousands of people mourned as his casket, draped in the red, yellow and green Kurdish flag and covered with red coronations, was carried through the streets.