Outside the courtroom, Mr Xu's supporters chanted slogans and raised banners in his support. Police pushed away the crowd and at least three protesters were held.
The Government has waged a 10-month drive against Mr Xu's New Citizens' Movement which advocates working within the system to press for change, including urging officials to disclose assets.
The campaign against the movement exposes the ambivalence in Beijing's bid to root out corruption as the authorities claim greater transparency.
Mr Xu, 40, is charged with "gathering a crowd to disturb public order", punishable by up to five years in prison. His prosecution will likely spark fresh criticism from Western governments over Beijing's crackdown on dissent.
Mr Xu's lawyer Zhang Qingfang said his client told the judge: "This court is not just so I will maintain my silence."