Large groups of demonstrators who had been camped around the Government House have been walking away from the area that has been occupied for three weeks.
The news follows calls by protest leaders for people to leave the area, after thousands of police and soldiers moved to tighten a cordon overnight.
Two people died in clashes involving demonstrators and residents on Monday.
Red-shirted protesters are demanding the resignation of PM Abhisit Vejjajiva - but he has refused and had urged them to go home.
On Tuesday, large groups of activists walked away from their encampment outside the main government offices.
Several thousand protestors had erected barricades following running battles with the army and the police on Monday, but their leaders called an end to the protest fearing further violence.
On Tuesday, protest leader Prateep Ungsongtham Hata told the AFP news agency: "We held talks among the leaders since last night and have agreed that we will disperse our protesters for a while."
Ms Prateep said the leaders wanted to prevent any loss of life, saying the protesters "really want to fight and sacrifice themselves so we wanted to prevent a catastrophe".
"We are not surrendering, we are just dispersing the gathering because we have done nothing wrong," she said.
Another protest leader, Jatuporn Pronpan, told Reuters: "We have to stop because we need to look after the lives of our supporters."
Protester Kannika Saikaew, 37, said: "I'm sad that we've not received justice but if we'd have stayed we would have been in danger."
The red shirts have largely lost popular support after the violence and destruction of Monday, a BBC correspondent in Bangkok says.
