WASHINGTON (AFP) - The United States (US) on Monday urged ally Thailand to find a peaceful way to resolve deep differences as it applauded restraint shown so far by authorities faced with major protests.

US officials "urge all sides to refrain from violence, exercise restraint and respect the rule of law", State Department spokesman Marie Harf told reporters.

"We do, I would note, applaud the restraint shown thus far by government authorities in this regard," she said.

Ms Harf said that US officials were working with a "full range" of players "to encourage dialogue and a peaceful democratic transition".

Thousands of protesters have swarmed Bangkok to urge Prime Minister Yingluck Shinawatra to quit and make way for an unelected "people's council" that would oversee reforms to curb the political dominance of her billionaire family.

The civil strife is the worst since 2010, when more than 90 people were killed in street clashes between soldiers and protesters who supported Yingluck's brother, ousted prime minister Thaksin Shinawatra.

Thailand is the oldest US ally in Asia, with Washington signing a treaty with the kingdom then known as Siam in 1833.

But recent US diplomacy aimed at resolving Thailand's polarisation has had a mixed reception, with a government in 2010 lodging a protest after a US envoy met pro-Thaksin political players.