Mr Milosevic accused French spies and the Bosnian Muslim Government of the time of engineering the killings.
"I want the truth to be revealed for this insane crime," he said, speaking as he finished a blistering three-hour opening statement in his own defence at his trial on war crimes charges at the Hague tribunal.
Involvement at Srebrenica is one of a list of 61 charges the former Yugoslav president faces in the second stage of his war crimes trial which opened on Thursday, dealing with the 1991-1995 wars in Bosnia and Croatia.
Bosnian Serb General Radislav Krstic was convicted of genocide by the tribunal last year for his role in the Srebrenica killings.
Karadzic 'innocent'
Mr Milosevic alleged that representatives of the Bosnian Muslim Government and the French Secret Service conceived the plan surrounding Srebrenica in July 1995.
Just days later the town, which had been a designated UN safe haven, was abandoned by Dutch troops and overrun by Bosnian Serb forces.
Thousands of men and boys were executed in Europe's worst atrocity in its post-World War II history.
Mr Milosevic said the French and Muslims decided "genocide committed by the Serbs will be made up... as a pretext for military intervention" in Bosnia.
He said the killings had been carried out by a mercenary unit, rather than regular Bosnian Serb soldiers.
He denied the involvement of Bosnian Serb wartime leader Radovan Karadzic and his general, Ratko Mladic, both of whom are also indicted over Srebrenica.
"President Karadzic swore to me he didn't know a thing about this," he said.
"I am convinced the military honour of Mladic and Krstic would not allow them to execute civilians," he said.
'Traitors'
On Friday, the tribunal began hearing testimony from the prosecution's first witness in the case against Mr Milosevic.
Milosevic charges
Bosnia
Croatia
Kosovo
The witness - who was part of a moderate faction of the Serbian Democratic Party in Croatia - was identified only as C-037 and his appearance and voice were altered.
C-037 testified that in the run-up to the Croatian war of 1991-92, Serb-controlled media was used by Belgrade to stoke the fears of the minority Serb population in Croatia and encourage armed rebellion against the Zagreb government.
But Mr Milosevic scorned the allegations.
"This is preposterous... how could this witness assess from his neck of the woods what the situation was in Belgrade?" he thundered.
C-037 also said moderate Serbs wishing to negotiate were called "traitors" and "our lives were threatened".
Hard to prove
C-037 is the first of 177 prosecution witnesses due to be called.
The next will be the serving Croatian President Stjepan Mesic.
Opening the case for the prosecution on Thursday, Geoffrey Nice argued Mr Milosevic had been involved in a plan to carve out an ethnically pure Serb state on the territory of the former Yugoslavia.
The BBC's Tim Franks in The Hague says that the charge of genocide - an attempt to exterminate an entire people - will be the hardest to prove.
In the Kosovo phase of the trial, which closed on 11 September, the prosecution failed to produce any one single devastating witness close to Mr Milosevic, and the defendant showed himself to be a pugnacious cross-examiner.