Over 1,000 students and Holocaust survivors protested Monday opposite the Knesset against the state's neglect of the survivors' economic problems.
The demonstrators also intended to protest at the Yad Vashem memorial where the main Holocaust Memorial Day ceremony was being held.
Reports in the past few weeks show that among the 250,000 survivors still alive, 80,000 live in dire poverty.
The Knesset began its Holocaust Remembrance Day ceremony, "To Each a Name" at 11 a.m. Monday in which ministers and members of Knesset read names of victims of the Holocaust.
Participants, which included acting President Dalia Itzik and Prime Minister Ehud Olmert, went up to the main stand and read out names of members of their families who perished during the tragedy.
Earlier, sirens sounded throughout the country, bringing life to a standstill as millions of Israelis observed the moment to honor the memory of Holocaust victims.
The two-minute siren at 10 a.m. (0700 GMT) is an annual tradition marking Holocaust Remembrance Day, which began Sunday evening and ends at sundown Monday. Pedestrians froze in their tracks, buses stopped on busy streets, and cars on major highways pulled over as the country paused to pay respect to the 6 million Jews killed by the Nazis.
On Sunday evening, Itzik told participants of Yad Vashem's central ceremony that the Holocaust is a stain on humanity.
The event was attended by the nation's leaders and by foreign dignitaries, as well as Holocaust survivors.
Itzik spoke on behalf of the State, emphasizing that the terrible act committed by the Nazis were committed by people.
The Holocaust proved evil can be organized," said Itzik. "The world needs to beware, and remember that the Nazis were human beings. The atrocities were created by people. The Holocaust is an "Ot Kain", a stain on humanity."
"There are no words that can explain the horror of the Shoah. Only the testimonies, silent and spoken can attain to this atrocity," said Itzik.
Also speaking at the ceremony, Prime Minister Ehud Olmert reminded guests and viewers of the importance remembering the Holocaust, and its role in the future of Israel's existence.
"Sixty-two years have passed since the end of the most gruesome battles history has bared witness to. On the day of victory, the entire world danced in the streets of the capital cities. Only the Jews did not join in these celebrations, there was no reason to celebrate - a third of their people were wiped out."
"Only on the day of Israel's independence did the Jews allow themselves to celebrate. In eight days we will be celebrating Israel's Independence Day. The correlation between this Remembrance Day, and the following celebrations is direct," Olmert continued.