A police officer at the scene in western Amman told reporters the protest was banned because the activists failed to get a permit from the authorities three days ago in line with the law and urged everyone to leave the area.
"The police banned us and asked us to leave for security reasons," said Medea Benjamin, the founding director of human rights group Global Exchange which is opposed to the US-led war in Iraq.
"We are all very upset because we had done similar protests all over the world. We're very shocked," she said.
As the protesters walked away they sang a refrain from one of John Lennon's classic songs" "All we are saying, is give peace a chance."
Benjamin was among a group of 15 people, most of them US citizens, who carried candles and banners with the word "peace" who wanted to stage a peaceful protest outside UN headquarters in Amman.
She said the group, including members of Families for Peace and women's anti-war group Code Pink, will go ahead with plans to hold a candlelit vigil Saturday on the Jordan-Iraq border to protest US involvement in Iraq.
The group recently sent 600,000 dollars worth of humanitarian aid to residents of the Iraqi town of Fallujah who were displaced by a massive US-led assault in November.