Marching with pro-Islam and anti-US banners, dozens of students of the Srinagar Medical College boycotted classes to hit the streets.
Police and paramilitary forces did not stop them as they remained peaceful.
After marching through the main markets, the protesters torched a US flag inside the college complex before dispersing.
Dozens of protests were carried out in the Kashmir Valley against the video Tuesday, leaving 10 people injured in clashes with security forces.
Muslim-majority Kashmir has witnessed a series of anti-American and Israel protests since last weekend, after news spread about a video uploaded on YouTube, which was a trailer of the blasphemous movie.
In Libya, a US diplomat was killed in an attack, apparently retaliation to the disrespectful content of the movie.
Kashmir, otherwise known to erupt over any act of blasphemy or desecration, however maintained calm and protested peacefully.
Earlier on Sunday, ministry of external affairs said Google India has blocked the anti-Islam film after formal requests made by them.
(Free Press Kashmir)