The crowd gathered in the Trocadero Square against the bill dubbed Charter of Republican Values
Hanane Loukili, one of the protesters, told Anadolu Agency that she was one of the victims of Islamophobia in France.
She said the school she ran was closed last November on the grounds that it did not meet security standards.
Keltouma, who only gave her first name, said the closed school was inclusive and students at the facility were being deprived of their fundamental right to education.
She said the school was a safe space for girls who wanted to dress up conservatively.
Olivia Zemor, head of EuroPalestine, a pro-Palestine association, said the proposed law was paving the way for more dangerous situations as it had the potential to put the public under control and surveillance.
Noting that the French bill was similar to the Israeli state’s policies on Palestine, Zemor said France was going through an unprecedented social and economic crisis, and Muslims were picked as the scapegoat during the period.
Last year, the bill was introduced by French President Emmanuel Macron to fight so-called "Islamist separatism".
It is being criticized because it targets the Muslim community and imposes restrictions on almost every aspect of their lives.
It provides for intervening in mosques and the associations responsible for the administration of mosques, as well as controlling the finances of associations and non-governmental organizations belonging to Muslims.
It also restricts education choices of the Muslim community by preventing families from giving children home education.
The bill also prohibits patients from choosing doctors based on gender for religious or other reasons and makes compulsory "secularism education" for all public officials.