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Clive Lewis, David Lammy and Geraint Davies have supported the new Labour Campaign for Free Movement - as have two MEPs and some union leaders.
Labour Leader Jeremy Corbyn has said freedom of movement "ends when we leave the European Union" and should be replaced by "fair" managed migration.
However the campaign says ending free movement would be "counterproductive".
Its founding statement says it is committed to "defending and extending" free movement of people "in the context of the debate around Brexit".
"The UK is at a crossroads in its relationship to the rest of the world and so is our party," the statement says.
"Immigrants and free movement are being scapegoated by a political and economic elite that is subjecting ordinary people to cuts and austerity... Labour should respond with clarity, humanity and solidarity," the campaign added.
At the moment, citizens from the other 27 EU member states have the right to come and work and live in the UK.
But immigration was one of the central topics of last year's EU referendum campaign, and ministers have promised to "take back control" of the UK's borders as they negotiate Brexit.
Labour's official position is that freedom of movement will end and the UK will leave the single market after Brexit.
But not all Labour MPs have fully supported the party's position.
In June, three frontbenchers were sacked for defying Mr Corbyn and supporting a call for the UK to stay in the single market.
Among others signing up to the pro-free movement Labour campaign are the general secretaries of the TSSA, UCU, and BFAWU trade unions; the MEPs Julie Ward and Lucy Anderson; the chairman of the left-wing think tank Compass; and various people from the national coordinating group of Momentum - formed after Mr Corbyn's successful 2015 leadership campaign.
Ms Ward, MEP for North West England, said: "Labour must stand up for freedom of movement, for a pluralistic society, and for the rights of EU nationals who live, work, study and pay into our tax economy.
"We must never cede greater benefits for capital and goods than we do for people," she added.
Manuel Cortes, general secretary of the TSSA (Transport Salaried Staffs' Association), said Labour should campaign to end the exploitation of workers, not end free movement.
But a Conservative MP and Brexit supporter, Andrea Jenkyns, said the campaigners were "out of touch with the country and their own party".
"The referendum result was a clear vote to take back control of our borders, and the Labour manifesto itself pledged to end free movement," she said.
The government has said freedom of movement will end when the UK leaves the European Union at the end of March 2019 - although Chancellor Philip Hammond has suggested full controls could take "some time".