Tens of thousands of Spanish protesters furious over soaring unemployment kept up their week-long movement on the eve of Sunday's local elections expected to hand the ruling Socialists a crushing defeat.

'In theory, we are going to continue' the protests after the elections, said Angela Cartagena, a spokeswoman for the organisers at the ramshackle protest 'village' that has sprung up in Madrid's Puerta del Sol square.

A 'general assembly' of the organisers would be held on Sunday morning to confirm the decision, she said.

Thousands of people have massed in city centres across the country in a snowballing movement that began on May 15, the biggest spontaneous protests since the property bubble burst in 2008 and plunged Spain into a recession from which it only emerged this year.

Spain's electoral commission on Thursday declared that protests planned for Saturday and Sunday were illegal as they 'go beyond the constitutionally guaranteed right to demonstrate'.

Saturday is by law 'a day of reflection' ahead of the regional and municipal elections, meaning political activity is barred.

But the Socialist government, facing a rout in Sunday's polls, has resisted ordering any police intervention.

'The government has not given such an (evacuation) order' and 'this will continue provided that there are no riots or crimes', an interior ministry source said.

Under the slogan of 'Real Democracy Now', the protests, popularly known as M-15, were called to condemn joblessness, the economic crisis, politicians in general, corruption and government austerity measures.

In the spearhead protest, thousands packed the Puerta del Sol square and spilled into surrounding streets on Saturday evening.

Some of placards read: "It's not a crisis, it's fraud," "Bankers should pay for the crisis," and 'revolution does not need violence'.

In a bid to avoid trouble, signs leading into the square read: "This is not a street party. If you want to drink please do it somewhere else."

Cartagena said the organisers were expecting even more people than Friday, when some 25,000 reportedly took part to cheer the chimes of midnight when the 48-hour ban began.

"The numbers have been rising exponentially throughout the week," she said.

In a new initiative, one of the organising groups, 'Toma la Plaza' ('Take the Square'), has called for 'popular assemblies' to take place on May 28 throughout Madrid and its surrounding region to discuss issues and spread the movement, Cartagena said.

Thais Ribera, 23 and unemployed, said she had travelled from the northwestern region of Galicia on Thursday.

"I'm here because everything has to change, not just in Spain but throughout Europe," she said.

"When I have children I want to be able to look them in the eyes," she said, carrying a cardboard sign round her neck that read, "Thank you. You have given me back faith in human beings."

She planned to enter a blank ballot in Sunday's election 'as I don't have enough choice', she said.

Spanish Prime Minister Jose Luis Rodriguez Zapatero has voiced sympathy for the protesters, saying they were reacting to unemployment and the economic crisis 'in a peaceful manner'.

Spain's unemployment rate soared to 21.19 per cent in the first quarter of this year, the highest in the industrialised world. For under-25s, the rate in February was 44.6 per cent.

Even before the protests, polls forecast devastating losses for Zapatero's Socialist Party as voters take revenge for the loss of millions of jobs and painful spending cuts, including to state salaries.

More than 34 million people are eligible to vote on Sunday, choosing 8,116 mayors, 68,400 town councillors and 824 members of regional parliaments for 13 of the 17 semi-autonomous regions.

Polls suggest the Socialists will lose control of strongholds such as the cities of Barcelona and Seville and the Castilla-La Mancha region.