A senior British National Party activist told a crowd that people in Bradford were living in a "multi-racial hell-hole", a court has heard.
The pair were greeted by supporters outside court as the trial began
Mark Collett, 26, head of publicity for the BNP, also told supporters asylum seekers were like cockroaches.
Mr Collett, of Rothley, Leicestershire, denies intending to stir up racial hatred and claims he was trying to encourage democratic campaigning.
BNP leader Nick Griffin denies two similar charges, at Leeds Crown Court.
The charges arose out of speeches made in Keighley in 2004 which were secretly filmed by BBC journalist Jason Gwynne for a documentary on the party.
On Monday, Mr Collett defended the content of speeches he made at the Reservoir Tavern and the Crossroads pub.
In them he said young white girls in Bradford and Keighley were being groomed for sex and prostitution by Asian gangs, the court heard.
"They don't go mugging Asian grandmas, they don't go stabbing each other, they don't go trying to solicit sex off little Pritesh or little Sanjita.
"They go straight to the whites because they are trying to destroy us and they are the racists," he is reported to have said.
Legal and democratic
He also said: "I honestly don't hate asylum seekers - these people are cockroaches and they're doing what cockroaches do because cockroaches can't help what they do, they just do it, like cats miaow and dogs bark."
Mr Collett said he was not trying to stir up racial hatred. Meetings were not open to the public and elaborate planning ensured only members and supporters turned up.
"The people admitted to the meetings are like-minded people", he said.
"They are people who already have that viewpoint."
The BNP activist said his speeches were aimed at convincing supporters there was a "legal and democratic" way to get their views over.
The trial continues.