Local authority staff will also be invited to join the march under the Highland Council banner at the Proud Ness event on Saturday, which is expected to draw around 2,000 people.
It comes after Donald Morrison, a home mission worker with the Free Church of Scotland (Continuing) launched a petition opposing the event on “biblical, religious and moral grounds.”
Several counter petitions were launched in response with thousands of people pledging their support for the march.
Bill Lobban, convenor of the Highland Council said Proud Ness was an opportunity to present Highland as an “inclusive and welcoming place to live.”
He added: “One of the council’s goals is to promote fairness and welcome diversity and I am delighted to agree to fly the Rainbow Flag at both the Town House in Inverness and at council HQ to show support for the Proud Ness event on October 6.
“It is especially important that young LGBTI+ people are able to find support when they need it and that schools can tackle and respond to homophobic and transphobic bullying. The Proud Ness event gives us an opportunity to show that Highland is an inclusive and welcoming place to live.”
Principal policy officer for equality, Rosemary Mackinnon invited staff who want to join the march under the council banner.
She said: “ We know that a number of staff from the council will be attending and they are welcome to walk together on the parade through the city centre under a banner supporting the Council’s commitment to promote fairness and welcome diversity.”
Rev Peter Nimmo, minister of Old High St Stephen’s Church of Scotland in Inverness, is due to speak at the event to highlight the importance of challenging “hatred, discrimination and exclusion”.