The protesters, some in their white lab coats, chanted and blew whistles as they marched to the Economy Ministry where they delivered a petition signed by more than 40,000 people demanding the government raise spending on science.
Protests were held in 18 other cities across the country, including Barcelona, Spain's second largest city, and Seville in the south.
The demonstrations were organised by the Open Letter for Science group, a platform grouping the main scientific bodies in the country, including societies, unions and universities specialised in the subject.
"The cuts have been brutal. Many labs can't carry out research because they don't have the means," said Irene Amigo, a 25-year-old biotechnologist who wore a hat she made out of styrofoam and cardboard depicting a human brain as a symbol of the "brain drain" Spain is facing.
Amigo said she plans to look for work outside of Spain when her internship at a public research centre ends early next year.
Public spending on research and development has plunged by 40 percent since 2009, according to the petition submitted to the Economy Ministry which calls on the government to boost spending on science "to avoid the massive exodus of our human capital".
The government cutbacks "are causing the Spanish science and technology sector to suffocate," the petition reads.
"We are on the brink of the collapse of what we believe to be one of the essential ingredients of the recipe that will allow us to get out of the economic crisis," it added.
Many academics also joined the march, as the cutbacks have affected disciplines across universities.
Xose Alvarez, a 32-year-old Spanish linguist who has been working in Portugal since 2009 because he could not find a job in Spain, was at the march in Madrid with a sign on his back that read: "Researcher for rent. Good price".
"I would like to work in Spain, it is my homeland, it is the country that invested in my education. Spain could benefit from my work, from my training. It was Spanish taxpayers who paid for my education," he said.
Spain, the fourth largest economy in the eurozone, is struggling to trim bulging annual deficits, which are rapidly pushing up the overall public debt.
Prime Minister Mariano Rajoy's conservative government has vowed to find €150 billion ($195 billion) in savings between 2012 and 2014 through a painful austerity programme that has sparked mass demonstrations.