Tony Blair has pledged to push other G8 leaders "the whole way" on securing a deal for increased aid for Africa.
The prime minister said he thought "substantial progress" could be made at the summit and that the US and UK were in broad agreement over the aid issue.
Anti-poverty campaigners led by Bob Geldof and fellow singer Bono said a deal on extra aid was not yet secured.
Mr Geldof urged the prime minister to stand firm on aid or run the risk of a "terrible human failure".
Mr Geldof held meetings with Mr Blair and other world leaders including President George Bush and Chancellor Gerhard Schroeder, who have arrived in Scotland for the two-day summit.
WHAT IS THE G8?
Group of eight major industrialised states, inc Russia
Canada, France, Germany, Italy, Japan, Russia, UK, US
Originally set up to discuss trade and economic issues
Now leaders discuss global issues of the day
2005 Summit agenda
One hundred people were arrested on Wednesday following a day of protests in Edinburgh and near the summit venue at the Gleneagles Hotel.
The Queen hosted a dinner for world leaders on Wednesday evening ahead of the start of formal talks on trade, aid and climate change.
Before attending the banquet, President Bush received treatment for minor injuries sustained when he collided with a police officer during a bike ride around the Gleneagles estate.
Mr Bush suffered scrapes on his hands and arms while the officer, who suffered minor ankle injuries, was taken to hospital as a precaution.
Speaking on Wednesday, Mr Blair said he would not flinch on trying to secure a deal at the summit.
"I'll push them (the G8 leaders) the whole way," he told the BBC.
"Do you ever get everything you want in negotiations like this? No. But can we make very substantial progress, can we change the terms of the debate on Africa? Yes we can."
The world leaders gathered for a dinner hosted by The Queen
Mr Blair acknowledged international differences over climate change but said he wanted "a firm understanding to end the trade distorting subsidies" - one of the more controversial issues and one on which many divisions remain.
Pop singer Bono urged the leaders to consider extra measures, such as the education of girls and the fight against malaria.
The prime minister had the "biggest democratic mandate in history" to press for an African aid deal, Mr Geldof added.
Breach of security
About 4,000 protesters gathered around the perimeter fence at Gleneagles during a day of tension between the march's organisers and police.
A small group of protesters breached the fence, prompting police to bring in reinforcements by helicopter.
Earlier, groups of protesters smashed car windows, attacked police and disrupted traffic by dragging branches onto the road, prompting police to temporarily revoke the permission to march.
With up to 4,000 police on duty, the summit is at the centre of the biggest security operation in UK history.
In other key developments:
- The final Live 8 concert has taken place at Edinburgh's Murrayfield stadium
- The UK insists the final summit communique will contain detailed commitments to help Africa, not just warm words.
- The European Commission pledges 1bn euros a year in extra aid for trade.
- President Bush insists African leaders must end corruption in return for debt cuts.
- Mr Bush also says he wants to move to the "post-Kyoto" era on global warming - with the emphasis on new technologies not cutting emissions.
- Scuffles broke out during a series of protests in Edinburgh, police making 18 arrests
For many protesters and observers, the G8 summit is a defining moment in current world politics, amid increased calls for the world's richest countries to act now to help the world's poorest.
The leaders of Canada, France, Germany, Italy, Japan, Russia, and the US are present at Gleneagles with the leaders of China, Brazil, India, Nigeria and South Africa also due to attend.
Pressure is on to reach deals on debt relief and aid for Africa, address global trade issues and adopt a unified stance in the fight against climate change.
Commitments to 100% debt relief for African countries and a doubling of aid for the continent are at the centre of discussions although it is thought that a firm deal has yet to be agreed.
Discussions over trade liberalisation and how to tackle global warming are likely to prove far more contentious.
President Bush has made clear he will not sign up to Kyoto-style limits on greenhouse gas emissions, highlighting strong differences with France.
Mr Blair is trying to reach a compromise by stressing commitment to eco-friendly technology to cut greenhouse gases.