He said that the land belonged to the black people of Zimbabwe and warned the white population that if they wished to remain, they should respect the country's laws.
President Mugabe acknowledged that his Zanu-PF party faced a real battle to stay in power in next weekend's parliamentary elections.
The independent Public Opinion Institute said its survey suggested the main opposition party would win 70 of the 120 parliamentary seats.
Several thousand supporters attended the rally in the capital, Harare, in what used to be Mr Mugabe's home constituency.
Repeated appeals for bus drivers to ferry more supporters to the meeting failed to boost the audience, although President Mugabe arrived nearly three hours later than scheduled to address them.
The administration secretary for the ruling Zanu-PF party, Didymus Mutasa, complained that he had expected a bigger turnout, and accused the organisers of failing to do a good job.
Double disappointment
Several hundred thousand people had turned out to hear Mr Mugabe at the same site 20 years ago, shortly before Zanu-PF swept to power on Zimbabwe's independence from Britain.
In his speech, President Mugabe repeated the familiar themes of the election campaign of recent months.
He said that the land belonged to the black people of Zimbabwe and warned the white population that if they wished to remain, they should respect the country's laws.
He accused the main opposition Movement for Democratic Change of being a puppet of foreign forces opposed to Zimbabwe, particularly Britain.
One report said that scores of those attending left while the president was still speaking.
Mr Mugabe went on to address another rally in Zimbabwe's second city, Bulawayo, before setting off for a summit in Egypt.
About a slow start, about 10,000 people gathered to hear him in a stadium where the MDC drew at least 20,000 supporters last month.
Zanu-PF expects....
The poor turnout at Mr Mugabe's rallies followed a similar disappointment yesterday for Zimbabwe's Vice-President, Simon Muzenda.
Two Zanu-PF defectors are standing as independent candidates there.
Opposition rallies
The MDC leader, Morgan Tsvangirai, addressed a rally in the northern area of Guruve, one of the poorer and more remote parts of the country, as part of his efforts to capture the key rural vote.
Some 2,000 farm workers defied ruling party threats and turned up to hear Mr Tsvangirai urge them to vote next weekend.
"We cannot accept the situation where anarchy becomes the law," Mr Tsvangirai said.
The MDC has found many similar areas out of bounds as a result of threats and violence by government supporters, often led by the War Veterans Association, which has spearheaded the illegal occupation of white-owned farms.
Several hundred international observers have arrived in Zimbabwe in an attempt to ensure that the elections are free and fair, but human rights groups say the intimidation has continued.
More than 13,000 rural people have sought refuge in towns and cities to escape political violence in the run-up to the election, according to the Zimbabwe Human Rights Forum.