Personal details about thousands of people - said to include those only suspected of minor public order offences such as peaceful direct action and civil disobedience - are being compiled on a database run by the National Public Order Intelligence Unit (NPOIU).
The data includes pictures of people taken demonstrations and other observations made by police on the scene, such as vehicle registration numbers. These enable cars to be tracked using automatic number plate recognition (ANPR) cameras.
The Guardian reported that a man with no criminal record was stopped more than 25 times in less than three years after he went to a small protest against duck and pheasant shooting.
However Anton Setchell, the Association of Chief Police Officers' national coordinator for domestic extremism, said anyone on the list who had not done anything wrong "should not worry at all".
He said he understood that some peaceful demonstrators might object to being monitored by surveillance officers, but added: "What I would say where the police are doing that, there would need to be the proper justifications."
Mr Setchell declined to say how many people were on the database - saying it was "not easy" to count - but estimated it numbered in the thousands.
The NPOIU is one of three units run by the Association of Chief Police Officers' terrorism and allied matters committee, which has a budget of £9 million and a staff of 100.
The database can be used to help surveillance officers at demonstrations identify those who police suspect may become involved in domestic extremism.
Radical comedian Mark Thomas was mysteriously sent a laminated police ‘spotter card' which identified him as one of 24 anti-arms trade protesters.
"You can imagine my reaction at finding I was the subject of a secret police surveillance process - I was delighted. I phoned my agent and told him I was suspect H. He replied: ‘Next year we'll get you top billing... suspect A!'" he told The Guardian.
However he added: "The very phrase ‘domestic extremist' defines protesters in the eyes of the police as the problem, the enemy. Spying on entire groups and organisations, and targeting the innocent, undermines not only our rights but the law. Protest is part of the democratic process."