The Deputy Prime Minister said flying the flag, a symbol of lesbian, gay, bisexual and transgender pride, to coincide with London's gay pride event this weekend was a ''small but important emblem''.
It comes after Mr. Clegg yesterday called for churches and other religious premises to be allowed to host gay weddings.
He said: ''There has to be a first time for everything - flying this iconic flag in the heart of Whitehall is a small but important emblem that the Government and this country are behind equal rights.
''I'm absolutely delighted that, with a little bit of persuasion and determination, we've been able to fly the rainbow flag for this weekend's festivities. I hope this is the start of a new era of pride across the historic Whitehall village.''