The so-called "Freital group" -- named after the members' hometown outside Dresden, the capital of the eastern state of Saxony -- consists of seven men, aged 19 to 39, and a 28-year-old woman.
Prosecutors say they staged five attacks with explosives between July and November 2015 targeting refugee housing and leftwing groups, causing two injuries.
Charges against them include forming a terrorist group, attempted murder and grievous bodily harm.
"They wanted to create a climate of fear and repression," federal prosecutor Joern Hauschild told the court.
"In at least one case, they accepted that people could die," he said.
Expecting a long trial, authorities spent five million euros ($5.3 million) fitting out a specially constructed courtroom, including on-site prison cells, in a structure on the outskirts of the city originally built to house refugees.
With anti-migrant sentiment high across the former communist East, the hearings were being held under tight security.
Dresden in particular has been a focal point for xenophobic groups as the home of the anti-Islam street movement Pegida.
'Large quantity' of explosives
And the neighbouring town of Freital was already making headlines in the summer of 2015, as images of rage-fuelled demonstrations against "criminal foreigners" and "asylum-seeking pigs" were beamed around the country.
It was the peak of the refugee crisis, with Chancellor Angela Merkel's September 4 decision to open Germany's borders to refugees and migrants travelling via Hungary and Austria.
Prosecutors say the defendants went to the Czech Republic and secured "a large quantity of explosives", planning to use them against refugee housing and the "homes, offices and vehicles" of local left-wingers.
The charge sheet includes an attack on a car belonging to the leader of far-left party Die Linke in Freital on the night of July 27, 2015, in which no one was hurt.
On the night of September 19, the group allegedly flung an explosive through the kitchen window of a refugee home.
While the blast hurled glass fragments through the room, none of the residents was harmed because they were all asleep in other areas of the home.
10 attacks a day
The following night, the group allegedly threw stones and home-made devices containing foul-smelling butyric acid at a social housing project, harming one of the inhabitants.
The final attack came on the night of October 31, when three explosives were hurled at the windows of a refugee housing centre. One person was harmed, suffering "multiple cuts" to the face.
After the charges were read out, the lawyer representing Maria Kleinert, the only female defendant, said his client "blamed herself" and "would, if she could, undo the acts".
Police arrested the two suspected ringleaders of the "Freital Group", identified as Timo Schulz and Patrick Festing, at the end of 2015.
Schulz was handed a one-year suspended sentence last year for attacking a car belonging to pro-refugee demonstrators with a baseball bat.
The remainder of the group was arrested in April 2016, when Dresden prosecutors handed the terrorism case to federal investigators, after being accused of dragging their feet.
The defendants face sentences of up to life imprisonment if found guilty of attempted murder, and one to 10 years in prison for being a part of a terrorist group.
Mindful of the notoriety that Freital has acquired over the attacks, the town's mayor, Uwe Rumberg, said: "One should not view the whole population and the whole city in the same light as the accused because of the incidents."
"That would not be fair to many peace-loving residents here," he told regional broadcaster MDR.
In 2016, there were about 3,500 attacks against refugees and asylum seekers in Germany -- 10 each day, on average -- injuring 560 people including 43 children, interior ministry data show.
Saxony, with just five percent of the German population, was the scene of 437 attacks last year, according to the RAA, a victims' assistance organisation, after 477 in 2015.
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