Riot police watched on as several hundred people, including some government ministers, marched unhindered through the Croatian town of Split on Saturday, many carrying flags and banners reading "Gay is OK" and "We are all equal."
Authorities had pledged to secure the pride event as a sign of determination to protect gay and other human rights ahead of joining the European Union in 2013.
Police said that they had briefly detained more than 40 people, but that there was no unrest despite threats of violence. Last year, extremists threw bottles and rocks at participants, drawing international condemnation.
The crowd walked along a route that was fenced off by the police, while a helicopter flew overhead and a water cannon was parked nearby.
Participants urged more rights for Croatia's gays and lesbians. "We want to be equal, we want equality for our families," activist Mirjana Kucer told the gathering.
"We have to stand in defense of every person in Croatia, and let them be whatever she or he wants to be," Minister for Foreign Affairs Vesna Pusic, t. "People should have the freedom and right to be what they want. And no one should persecute, attack, beat and discriminate them just because of what they want to be."
Local police chief Ivica Tolusic said police were "more than pleased" that the event had passed without incident.
Also Saturday, a march in support of the Split event was held in the northern Adriatic port of Rijeka, where some 300 people took part.
Anti-gay violence is common in the conservative Balkans. A pride event was cancelled in Serbia last year over extremist threats, while hundreds were injured during a march in 2010.
No pride events were ever held in Bosnia or Montenegro, while in Croatia, the first pride gathering took place ten years ago in the capital of Zagreb.