KATMANDU, Nepal (AP) — Tens of thousands of former communist rebels and their supporters rallied in the capital Saturday demanding Nepal's coalition government be disbanded and replaced by a Maoist-led government.

Prime Minister Madhav Kumar Nepal refused to resign and instead called on the Maoists to resolve the Himalayan country's political crisis through dialogue.

In response, Maoist leader Pushpa Kamal Dahal announced to cheering supporters they would launch an indefinite general strike from Sunday.

"It is not our pleasure but compulsion to impose the general strike to save the nation and the people," Dahal said. "Revolution and major political changes in Nepal have come through street protests."

Police estimated some 125,000 people joined the Maoists' rally.

The standoff has raised fears of renewed violence in Nepal, where the Maoists ended their decade-old insurgency and joined a peace process in 2006.

Since the bloody insurgency ended, the Maoists have confined their fighters in U.N.-monitored camps and contested general elections in 2008. They briefly led a coalition government but their leader resigned as the prime minister following differences with the president over the proposed firing of the army chief. Political tensions have escalated again in recent months.

In a nationally televised speech, the current premier, Nepal, refused to step down.

"The government formed with the support of majority in parliament can be changed only through legal parliamentary process," Nepal said, urging the Maoists to cancel their general strike and "move toward forming national consensus."

Some 15,000 police in riot gear were guarding the streets of Katmandu for Saturday's rally. Traffic was halted and shops and markets were closed. The protesters chanted slogans against the government and waved their party's red flags.

No violence or clashes between police and protesters were reported, Katmandu police chief Ramesh Kharel said.

Karin Landgren, chief of U.N.'s peace mission in Nepal, said she met Maoists leaders to appeal for a peaceful resolution to the crisis and had been assured the demonstrations would be peaceful.

"I am deeply concerned that despite these peaceful intentions, potential spoilers of the peace process could provoke a clash," Landgren said Friday.

A statement from the U.S. Embassy in Katmandu appealed for the parties to exercise restraint, work toward consensus and find a way through the impasse.

"Nepal has come a long way since the Comprehensive Peace Agreement was signed in 2006 and these gains should not be lost," it said.

At least 13,000 died during the decade-long Maoist rebellion that preceded the peace agreement.