The fractious pro-democracy camp is looking for a boost from Chan, 67, the frontrunner in public opinion polls, after a demoralising drubbing in district council elections last month at the hands of the biggest pro-Beijing party.
Chan made a name for herself as the first Chinese, first female head of the civil service under British rule, and she emerged from retirement a year ago to press for universal suffrage, disillusioned by the slow pace of reform.
Event organiser Fonda Chui, 46, said she voted for Chan based on principle.
"I understand there is very little about democracy that we can do in Hong Kong. There are a lot of people who are pro-government. But we need somebody who stands up on the side of the people," she said.
Ip, 57, enjoys the support of the city's powerful pro-establishment constituency, which is content to let Beijing decide when and how democracy should be expanded.
Ip is perhaps best known for trying to force an unpopular anti-subversion law through the city legislature in 2003 when security chief. That bid is widely blamed for sparking a protest that drew half a million people into the streets, shocking leaders in Beijing.
Chef Sammy So, 36, voted for Ip, and said he did not consider democracy a touchstone issue. "I think 50 percent of Hong Kong people just care about their jobs and how much money they make. I'm in that 50 percent."
Analysts say a win by Chan could give the pro-democracy camp a boost in full Legco elections next year.
By 7:30 pm (11:30 a.m. British time) 42 percent of the 620,000 eligible voters had cast ballots, a high turnout so far by Hong Kong standards. Polls close at 10:30 pm.
