A pardoned ally of jailed former minister Yulia Tymoshenko said upon his release from prison on Sunday that he dreamt of a "European Ukraine" as several thousand people rallied against the authorities in Kiev.

The former Ukrainian interior minister, who is a close ally of jailed former prime minister Yulia Tymoshenko, Yuriy Lutsenko, walked free from a prison in northern Ukraine after being pardoned by President Viktor Yanukovych earlier in the day.

Lutsenko, who like Tymoshenko was a key figure in the country's 2004 pro-democracy Orange Revolution, said upon release from the Menskaya corrective labour facility in the northern village of Makoshyne that he would seek a meeting with Tymoshenko and remain in politics.

"I will be in the streets, among people," Lutsenko, dressed in jeans and an ethnic Ukrainian embroidered shirt, told reporters after being greeted by his wife Irina and friends.

He went on to address a rally of several thousand people in the capital Kiev called by Ukraine's opposition leaders last week to demand Yanukovych's resignation.

"I am sincerely happy that I will finally be among those who like me are dreaming about an independent and European Ukraine," he told the rally dubbed "Rise Up, Ukraine" by phone.

"Politics is being done not in the offices, it is being done in the squares. We've already won there and we will win again," he told the rally, the largest protest action in Kiev so far this year.

He was referring to the 2004 Orange Revolution, when hundreds of thousands of Ukrainians took to the streets to protest rigged elections that handed victory to Yanukovych.

Lutsenko was arrested in 2010 and sentenced to remain in prison until late 2014 after being convicted of abuse of office and embezzlement.

More than 7,000 people turned up in central Kiev, many holding placards with slogans like "Freedom to Yulia" and "Down with the gang," an AFP correspondent reported from the scene.

Tymoshenko's Fatherland party put the turnout at 20,000 although that number appears to be exaggerated.

The rally was called after pro-government lawmakers in the Ukrainian parliament last week split off to hold a plenary session at an alternative venue amid a weeks-long standoff with the opposition.

The opposition described the rare walkout as a coup attempt and called on prosecutors to open a criminal probe.

At the rally, the opposition leaders called for the release of all "political prisoners".

"We will fight for the release of Yulia Tymoshenko because after Yuriy Lutsenko was freed Yulia Tymoshenko should be freed too," said leading opposition figurehead Arseniy Yatsenyuk, who represents Tymoshenko's party in the parliament.

Charismatic opposition politician and former boxing champion Vitaly Klitschko for his part called on the authorities to schedule new parliamentary and presidential elections.

"I am sure that every day more and more people will be joining us," said the towering 6.5-foot tall (1 metre 95cm) pugilist whose party got into parliament during legislative elections last year.

"I am sure that we will be able to stick it out and unite into a fist to deliver a decisive blow," he said.

The last time the Ukrainian parliament split into two and met at separate venues was under then president Leonid Kuchma in 2000.

On Tuesday, opposition leaders led some 5,000 people in another rally in Kiev demanding new mayoral elections.