British National Party leader Nick Griffin made a speech claiming white society had turned into a multi-racial hell-hole, Leeds Crown Court has heard.
Mr Collett and Mr Griffin both deny the charges against them
Mr Griffin is accused of two counts of using words or behaviour likely to stir up racial hatred, in speeches filmed in West Yorkshire in 2004.
Party activist Mark Collett is charged with similar offences. Both men deny the charges.
The speeches were filmed in 2004 for the BBC documentary, The Secret Agent.
Mr Griffin, 45, from Llanerfyl, Powys, is accused of four counts of the charge, while Mr Collett, 24, from Rothley, near Leicester, faces eight charges.
Footage of their speeches in Morley, Pudsey and Keighley was obtained by undercover reporter Jason Gwynne.
The court heard how Mr Griffin addressed a crowd at the Reservoir Tavern in Keighley on 19 January 2004 and told them that white society had turned into a multi-racial hell-hole as Asian Muslims aimed to conquer the country.
Rodney James QC, prosecuting, told the jury Mr Griffin had concentrated on allegations of paedophile drug rapes by Asian Muslims in Keighley.
Reading excerpts from the speeches, Mr Jameson said Mr Griffin had urged the crowd to vote for the BNP in order to ensure "the British people really realise the evil of what these people have done to our country".
During his speech at the same event, Mr Collett claimed people in Bradford and Keighley were living in hell because of rapes and muggings which were always carried out by Asian people on white people.
"If the local newspapers saw what I was saying tonight, they would call me, and they would call you, racists," he said in the film, the court was told. "But the racism is against whites."
Mr Jameson said the defendants built fear and resentment of Asian people, creating a "nightmare vision".
On 5 May 2004, Mr Griffin made a speech at Morley Town Hall, in which he discussed the BNP as an alternative to other political parties.
Mr Jameson said some of his analysis could be thought of as perfectly legitimate political comment.
But he urged the jury to look at how and why Mr Griffin had made the comments.
"We agree that freedom of expression is an important right but it cannot be unfettered," he said.
"No society can permit disapproval of another race to be expressed in such strong terms that hatred be stirred up against people on the basis of race or ethnicity."
Later, Mr Gwynne told the court he had infiltrated the BNP with the help of a mole.
Under cross-examination, he admitted he had once been a student member of the Anti-Nazi League, but said he approached the BNP investigation with an "open mind".
The trial continues.