Alexei Navalny sentenced to five years in prison

The Russian opposition leader Alexei Navalny has been sentenced to five years in prison at the end of a trial that was seen as politically motivated.

Navalny was taken from the courtroom in handcuffs after the judge, Sergei Blinov, ended a three-hour verdict reading by finding him guilty of embezzlement. He hugged his wife, Yulia, and was led away by police.

On Thursday night, thousands of Russians flooded the main arteries leading to the Kremlin, demanding his freedom and calling for the ousting of the president, Vladimir Putin. Dozens were detained.

An anti-corruption activist who became the most popular figure to emerge from protests that erupted around Putin's return to the Kremlin last year, Navalny was accused of embezzlement, and a handful of other charges, after Putin unleashed a crackdown on the opposition in the wake of his inauguration.

"When I heard the verdict, it felt like it was happening to one of my relatives," said Yevgeny Zakharov, a 31-year-old lawyer for a state-run oil company. "My hands were shaking."

Navalny has built a large following via corruption investigations into Putin's closest allies that he publicises on his popular social media accounts and blogs. On Tuesday, just two days before the verdict hearing, he released an investigation into alleged corruption at Russian Railways, one of Russia's largest state-run firms, headed by a close Putin ally, Vladimir Yakunin. He has dubbed Putin Russia's "main thief".

The verdict against him – that he embezzled 16m roubles (£325,000) from a timber firm while advising the governor of Russia's Kirov region – is widely seen as a means of silencing him.

The charismatic 37-year-old said goodbye to his supporters via his popular Twitter account: "OK. Don't get bored here without me. And most importantly – don't dawdle, the frog won't jump from the oil pipes itself."

He was sentenced alongside a co-defendant, Petr Ofitserov, who was given four years in jail. Ofitserov's wife, and the mother of his five children, sobbed uncontrollably after the sentence was handed down.

As the verdict was being read, Ofitserov wrote on his Facebook page: "I'm getting lots of messages saying: 'hold on, hold on'. Thanks everyone for the support – it helps. But if they jail people like us, then we're not the ones who will have to hold on. It's bad in the cage, but at least it's honest. You'll have to make a more difficult choice – either you're with them or with yourselves."

In Moscow, the centre of last year's anti-Putin protests, Russians erupted in anger at the verdict. Thousands occupied Tverskaya, the main street leading to the Kremlin, as riot police and special forces attempted to break up the gathering. Protesters shouted "Freedom" and erupted into applause as cars honked in solidarity.

In a possible sign that the Kremlin was unsure how to deal with the protesters, prosecutors announced they would challenge Navalny's arrest directly from the courtroom and ask for him to be released during the appeals process. A hearing was set for 10am on Friday.

William Hague, the UK foreign secretary, said he was concerned about the sentence, which he said pointed to the "selective application of the rule of law in Russia". Michael McFaul, the US ambassador to Moscow, said: "We are deeply disappointed in the conviction of Navalny and the apparent political motivations in this trial."

Catherine Ashton, the EU's foreign policy representative, said: "The outcome … raises serious questions as to the state of the rule of law in Russia."

Western criticism has done little to stem the Kremlin's campaign against its critics in the past.

In a statement released after the verdict, Mikhail Khodorkovsky, once Russia's richest man and now its best-known political prisoner, wrote that it was "inevitable and predictable" because of Russia's long history of jailing political opponents. Khodorkovsky was arrested 10 years ago on economic charges widely seen to be punishment for his wealth and ability to challenge Putin.

"[U]ntil we realise that the trials of Navalny, Bolotnaya and hundreds of thousands of other guiltlessly convicted people are our trials, they are just going to keep on locking us up, one at a time," he wrote. "The era of unbelief and indifference is ending."

Mikhail Gorbachev, the last Soviet premier, issued a rare statement to condemn the verdict against Navalny, saying it "proves that we have no independent judiciary".

The Russian elite also expressed shock and anger at the verdict.

Alexei Kudrin, a former finance minister who remains close to Putin, wrote on Twitter: "The verdict seems less like punishment and more like it is aimed at isolating him from society and from the election process."

Navalny, who largely appeals to Russia's internet-connected urban youth disillusioned with Putin's increasingly authoritarian politics, was waging a campaign for Moscow mayor in snap elections called for September. He was forced to withdraw his candidacy in the wake of the verdict.

If he is to serve the entire five-year sentence, he will be released from jail only after Russia's next presidential election, in 2018.