The families had gathered in the city's Bogside at around 9am this morning before marching to the Guildhall to hear the decision, while singing the Civil Rights anthem "We Shall Overcome".
The prosecutor announced on Thursday that there was sufficient evidence to prosecute "Soldier F" for the murder of James Wray and William McKinney and for the attempted murders of Joseph Friel, Michael Quinn, Joe Mahon and Patrick O'Donnell.
Ciaran Shiels, a solicitor for a number of them, said they were "disappointed that not all of those responsible are to face trial".
The British government said it would provide full legal support to the soldier who will face prosecution.
The letter went on: "The Ministry of Defence has ensured that all veterans under investigation in Bloody Sunday are aware of the support available, either via their legal representatives or directly".
The former soldier, identified as soldier "F", was a member of the 1st Battalion Parachute Regiment sent to the protest in Londonderry on January 30, 1972.
In 2010, then British prime minister David Cameron issued a formal state apology for the killings, calling them "unjustified and unjustifiable".
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Relatives of the deceased have waited for decades to see whether or not the individuals will be charged.
"We are indebted to those soldiers who served with courage and distinction to bring peace to Northern Ireland", Mr Williamson said.
The UK Ministry of Defence has said its serving and former personnel can not live in constant fear of prosecution.
He noted that today "will be another extremely hard day" for family members of the victims of the massacre and noted that he met with them personally "to explain the prosecution decisions taken and to help them understand the reasons".
Families of those who died on Bloody Sunday marching through the Bogside in Londonderry. After the announcement, they were unable to hide their disappointment with the decision.
The Saville Report, which was published in 2010 after a 12-year inquiry by High Court Judge Lord Saville, reversed the findings of a hastily-convened inquiry from 1972 by another judge, Lord Widgery, who concluded the soldiers only fired after being fired upon. We wanted to meet with them personally to explain the prosecution decisions taken and to help them understand the reasons.
Reflecting on his meeting with the families, the director added: "I am mindful that it has been a long road for the families to reach this point and today will be another extremely hard day for many of them".
The PPS pored over more than 125,000 pages of evidence from Bloody Sunday in coming to their decision.