McDonald was killed in October 2014. The city's mayor has called for peace.
"I believe this is a moment that can build bridges of understanding rather than become a barrier of misunderstanding. I understand that the people will be upset and will want to protest when they see this video," Mayor Rahm Emanuel said. "We as a city must rise to this moment."
Chicago has been preparing for protests in advance of the video's release, which was ordered by a judge to happen no later than Wednesday.
McDonald was a black teenager. The officer who shot him, Jason Van Dyke, is white.
He was charged Tuesday with first-degree murder in McDonald's death and is being held without bond.
Chicago Police Superintendent Garry McCarthy acknowledged that residents "have a right to be angry."
Soon after the video's release, a group of protesters began marching, chanting "16 shots" and "We got to fight back!" McDonald died after being shot 16 times.
The NAACP said that McDonald's family and the community deserve action.