Thousands of persons marched from the poor neighborhoods of Santiago to its central cathedral this afternoon to honor a French priest killed in national protests and to demand justice from the government of Gen. Augusto Pinochet.

Residents of the poor neighborhood of La Victoria began a long march from southern Santiago to the central Plaza de Armas shortly after noon with the coffin of Andre Jarlan, the priest shot during police repression of demonstrations in La Victoria Tuesday.

People from all over the capital joined the procession as it passed through their neighborhoods or lined streets to watch it pass by. A crowd of at least 20,000 joined in a requiem mass for Jarlan in the cathedral or the Plaza de Armas outside, waving white hankerchiefs and shouting, "We want justice."

When the mass celebrated by Archbishop Juan Francisco Fresno ended, the crowd turned to chants of antigovernment slogans. A group of more than 500 militants, mostly members of the Communist Youth, then marched through downtown Santiago and blocked traffic on central Bernardo O'Higgins Avenue. Police responded with water cannon and tear gas and more than 15 persons were reported injured.

Jarlan's death emerged as the most dramatic result of two days of national antigovernment protests this week that left nine dead and more than 1,000 arrested nationwide.

The incident exacerbated perpetually tense church-government relations, threatened a diplomatic conflict, and appeared to have had a strong impact on thousands of average citizens.

Last night, thousands of persons in Santiago's poor southern neighborhoods lined the streets around their homes with candles in a silent memorial to Jarlan.

Government officials conceded that widespread demonstrations and the building of barricades had paralyzed the southern districts Wednesday night.

Fresno, who called the death "a shame to our country," said it should serve as an impetus for conciliation in Chile's increasingly violent political impasse.

"While we go on as enemies, we are going toward ruin, toward disaster," he said in a midday statement.

Government officials sought to avoid a confrontation with the church over Jarlan's shooting and to limit its political consequences. Authorities continued to deny reports by witnesses that Jarlan was shot by police seeking to repress protesters in La Victoria. The officials promised church and French Embassy officials a full investigation.

At the same time, government authorities dropped initial attempts to halt today's march and lifted censorship imposed Tuesday on two church-supported radio stations.

Interior Minister Sergio Onofre Jarpa, who met privately with Fresno both Wednesday night and today, warned of the "politicization" of the event but said police would not repress it.

The conciliatory attitude toward the church was mixed with new government threats of a crackdown on the opposition and reassurances to its own political supporters.

President Pinochet told reporters yesterday that organizers of protests would be prosecuted and that activities of police and intelligence services would be stepped up for future demonstrations.

Military authorities maintained censorship today on two radio stations reflecting opposition views, including the Christian Democrat-supported Radio Cooperativa of Santiago, while government lawyers continued to press legal action under internal security laws against the four opposition magazines currently allowed to publish.

Meanwhile, officials indicated that a new law regulating political parties, a key step in the government's planned transition toward democracy during the next five years, would be sanctioned in the coming days.

The decree already has been repudiated by the government's opposition, made up of parties and labor leaders from the center-right to the pro-Moscow Communists. However, the official initiatives are expected to be welcomed by right-wing groups supporting the government. These sectors hope Pinochet will gradually liberalize his 11-year-old rule and have been alarmed by the president's shift to a harder line in recent months.