The march is scheduled to take place Nov. 10, a day after the anniversary of Kristallnacht - the 1938 night of terror when the Nazis attacked synagogues and Jewish homes and businesses throughout Germany and parts of Austria.
It is organized by the Young National Democrats, which is linked to the National Resistance, a neo-Nazi group. Organizers said it was meant to protest the deployment of Czech troops in Iraq.
The march was banned Oct. 4 by Prague City Hall, which said it would incite "hatred and intolerance of citizens because of their nationality, origin and religious faith."
The ban, however, was overturned Friday by Prague's Municipal Court on the bases of procedural issues.
"The representative of Prague's Jewish community are alarmed that despite all the efforts the authorities have failed to ban the neo-Nazi demonstration," community leader Frantisek Banyai said in a statement Wednesday.
"It is absolutely obvious that the march through the Jewish quarter on the anniversary of the pogrom is meant as a menace which has nothing to do with the declared protest against the war in Iraq," Banyai said.
"Prague's Jewish community, together with all who take the neo-Nazi threat seriously, are ready to guard the religious gathering, secure security for its participants and prevent the neo-Nazis from marching through the Jewish quarter," he said.
The gathering will commemorate the victims of the pogrom, he said.
Prague officials have pledged to do all they can to find legal ways to ban the march.