Indigenous groups are demanding a $1bn clean-up
A group of Ecuadorean Indians is filing a billion-dollar lawsuit in Quito against the US oil giant, ChevronTexaco.
They accuse the company of destroying large areas of rainforest and contaminating local land and rivers.
They are also alleging the company's activities have led to an increased risk of cancer among the local population.
ChevronTexaco rejects the allegations and says the company met all its obligations under Ecuadorean law.
Correspondents say the case has led many indigenous communities to stage protests in the hope of keeping foreign companies out of the jungle.
'Forced to leave'
The case which is being heard in Ecuador for the first time follows years of US court battles over jurisdiction.
This has caused a lot of damage, and made a lot of people ill... we are suffering from diseases like leukaemia, and thousands of our people have been killed
Elias Piguaje, Indian leader
Indian groups say Texaco - which merged with Chevron in 2001 - dumped billions of gallons of toxic materials into unlined pits and Amazon rivers from 1972 to 1992.
As a result, they say, crops were damaged, farm animals killed and cancer has increased among the local population.
Elias Piguaje of the indigenous Secoya group said local communities had been forced to leave their lands when the oil subsidiary was operating there.
"We are now living in tiny areas in the Amazon, what was once our rainforest. The land and the big rivers have all been polluted and destroyed," he said.
"This has caused a lot of damage, and made a lot of people ill."
Lawyers, who say they are representing 30,000 people, are demanding that the company pay for a clean-up which it is estimated could cost $1bn.
The company operated in accordance with all applicable Ecuadorean laws
The company says that after leaving the country it spent $40m in a clean-up project that was inspected and approved by the Ecuadorean Government, according to the Reuters news agency.
And a spokesman for US company told the BBC that Texaco was only a minority partner in a consortium with the state oil company and that all operating decisions had to be put before the consortium.
"The company operated in accordance with all applicable Ecuadorean laws, and used practices that were consistent with international practices for the time," Charles Giddes said.
But one of the lawyers representing the Indians, Joseph Kohn, accused the oil giant of trying to hide behind the Ecuadorean authorities.
He said the government did not have sufficient knowledge of oil exploration and precisely for that reason, contracted Texaco - as the supposed experts.