A local journalist reported the demonstrators in Old Manama were shouting “Down, down, F1” and demanding the release of Abdulhadi al-Khawaja.
The activist has been on hunger strike in prison for more than two months.
Abdulhadi al-Khawaja’s lawyer earlier said his client had removed the intravenous drip keeping him alive.
The 52-year-old told his wife on Tuesday afternoon that he was also now refusing anything but water, Mohammed al-Jishi said.
Abdulhadi al-Khawaja believed nothing was being done to resolve his continued detention, and this was the only way to force the issue, he added.
He was convicted by a military court in June of plotting against the state, but human rights groups have said that his trial was “grossly unfair”.
They said his conviction was based on a confession he made under duress, and that no evidence was presented showing he had used or advocated violence during protests against King Hamad Al Khalifa.
Bahrain’s highest court is due to rule on Abdulhadi al-Khawaja’s appeal against his conviction on Monday – a day after the Grand Prix.
Last year’s race was cancelled after at least 35 people, including five police, were killed during a crackdown on pro-democracy protests.
Formula 1’s governing body, the FIA, only decided to go ahead with this weekend’s race at the last minute.
On Wednesday, opposition supporters held a protest demanding Sunday’s Grand Prix also be called off, and calling for the immediate release of Abdulhadi al-Khawaja in Old Manama.
A Bahraini journalist, who asked not to be named for fear of arrest, said there were chaotic scenes outside Bab al-Bahrain, which marks the entrance to the main souq.
Veteran activist Nabeel Rajab reportedly stood near Bab al-Bahrain chanting anti-government slogans, while others carried signs reading: “Your silence is killing al-Khawaja.”
The journalist warned: “If he dies the streets will explode.”
Riot police at first demanded the protesters leave. When they refused, officers fired deafening “sound bombs” into the crowd, sending protesters and bystanders running.
Stun grenades and rubber bullets were also used to disperse the protesters, while helicopters circled overhead and interior ministry officers filmed the clashes, the journalist said.
The Bahrain Youth Society for Human Rights meanwhile told AFP news agency the authorities had arrested about 80 pro-democracy activists from villages outside the capital ahead of the Grand Prix.
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