The peace rally took place in the Tel Aviv plaza where Rabin was fatally shot on Nov. 4, 1995, by an extremist Jew opposed to his peace efforts.
"For me, this is reassurance of the desire for peace, reassurance for people against violence, and reassurance of Rabin's way," said Zvi Friedman, one of the rally's organizers.
A large picture of Rabin hung behind the stage, with the words "Eight years since the murder." Many of the people in the crowd carried banners backing the peace process, saying, "There is no other way."
Labor party leader Shimon Peres, who was with Rabin at the plaza moments before he was gunned down, said he felt his old partner's presence at every memorial rally.
"Every time I mount these stairs, at this building, at this time of evening it is as if I am coming to shake Yitzhak's hand," he told the cheering crowd.
Peres said the path to peace is difficult, but the country must carry on.
"Without a clear decision, the Zionist enterprise will stand in mortal danger," he said. "Even the right has started to understand that it's better to have two states which will have to live in peace than one state where two peoples fight forever over every piece of land, every drop of water."