Muslim preacher Abu Hamza al-Masri has denied urging a "tinderbox" congregation to go out and murder.
Mr Abu Hamza admitted the crowd was angry
Prosecutor David Perry told the cleric's Old Bailey trial he urged congregation members to kill, ambush or poison for the Palestinian uprising.
Mr Abu Hamza said there was anger at north London's Finsbury Park mosque but denied trying to "ignite" listeners.
Mr Abu Hamza, 47, from west London, denies 15 charges, including soliciting murder and inciting racial hatred.
Mr Perry told the jury the cleric had urged listeners to do anything within their power to help the Intifada (Palestinian uprising).
He quoted Mr Abu Hamza as saying: "If it's killing, do it, if it's paying, pay, if it's ambushing, ambush.
"If it's anything, poisoning, poison, you help your brothers, you help Islam in any way you like it, anywhere you like.
"They are a Kafir [infidel] and they are all fighting us as one body and we should give them back as one body."
Mr Perry described Mr Abu Hamza's performance as "powerful words spoken by a preacher to a tinderbox congregation who were angry".
Mr Abu Hamza, on his fourth day of giving evidence to the trial, agreed the listeners were angry.
"When you tell them to kill, what do you think they are intending to do?" Mr Perry asked.
"I am not saying murder, I am saying go and resist," Mr Abu Hamza replied.
"The job of a preacher is not to ignite people's anger, but direct it, but now I am being punished for it," he said.
Preachers should be neutral, he added.
"I do not order people. I do not have followers - I have listeners."
Asked about Saddam Hussein, Mr Abu Hamza said he thought the former Iraq leader was a tyrant to his people "which has resulted in the occupation of the peninsula and the mass emigration of the Iraqi people".
Under re-examination by his own counsel, Mr Abu Hamza was asked how he would have felt if Saddam Hussein had been killed by his generals.
"I would be happy, but what could happen if it became worse?" he replied.
If Saddam Hussein had been replaced by one of his generals "it could be worse than Hitler", he added.
The cleric faces nine charges under the Offences Against the Person Act 1861, which allege that he solicited others at public meetings to murder Jews and other non-Muslims.
He faces four other charges under the Public Order Act 1986 of "using threatening, abusive or insulting words or behaviour with the intention of stirring up racial hatred".
A further charge claims the defendant was in possession of video and audio recordings which he intended to distribute to stir up racial hatred.
The final charge, under section 58 of the Terrorism Act, accuses him of possessing the Encyclopaedia of the Afghani Jihad, which, it is claimed, contained information "of a kind likely to be useful to a person committing or preparing an act of terrorism".
Mr Abu Hamza denies all the charges.
The case was adjourned until Thursday.