Protesters are angered by a $700m (£455m) payment made to Mr Najib's bank account from unnamed foreign donors.
He has denied any wrongdoing, saying protesters were tarnishing Malaysia's image.
Police estimated 25,000 people participated in Saturday's demonstration, while Bersih - the pro-democracy group behind the rally - said 200,000 took part
Former Prime Minister Mahathir Mohamad made a surprise appearance late on Saturday, telling the cheering protesters to "carry on". He has backed calls for Mr Najib to quit.
The crowd thinned in the evening, but many slept out on the street in readiness for the second day.
The rally was scheduled to last until midnight on Sunday
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