The protest organisers planned to hold a large rally for much of Sunday in front of the Kangaroo Point Central Hotel, where about 120 men are being held.
But police successfully applied to Brisbane Magistrates Court on Friday to have the gathering limited to two hours.
Concerns were raised over disruptions to traffic and how people would adhere to the COVID-19 health restrictions that currently restrict gatherings to a maximum of 20 people.
Protesters will also only be allowed to congregate on two side streets and not on Main Street as they did last weekend.
“We are disappointed with the result but not deterred,” protest organiser Rilka Laycock-Walsh said via text.
“We will continue protesting to demand the release of these innocent men by Christmas.”
About 300 people gathered on Saturday to demand the government stop transferring the asylum seekers from the hotel, claiming it was an attempt to silence the men’s complaints about their treatment.
Organisers were permitted to hold that rally, saying they had negotiated with police over social distancing issues.
Protesters have also been camping outside the hotel for more than a week in a bid to prevent the removal of asylum seekers.
Spokeswoman Keri Okee told the court on Friday that police had assisted them to search vehicles leaving the premises to ensure no one was being removed.
Friday’s court ruling comes as prosecutors dropped charges against Greens councillor Jonathan Sri, who was arrested at Saturday’s protest for contravening a police direction.
By Aaron Bunch