He said the bug planted in Incedal's car recorded him saying: "I hate white people" and telling his wife he might have to switch to "plan B" after his car was searched.
When he was arrested two weeks after the initial "traffic offence" on September 30 last year, police seized material including a memory card containing a bomb-making manual.
Whittam said: "You will hear that he was actively engaged with another or others who were abroad. The prosecution case is that such engagement was for an act, or acts, of terrorism either against a limited number of individuals of significance or a more wide-ranging and indiscriminate attack such as the one in Mumbai in 2008."
Referring to the piece of paper containing the Blairs' address, Whittam said that although Incedal had not decided on a particular target or methodology, the address may "have some significance".
Incedal denies preparing acts of terrorism and possessing a document titled Bomb Making.
The prosecution's opening speech gave a rare insight into the tactics used by anti-terrorism police in gathering evidence against suspects.
The jury was told that the officers searched the car and found various items of interest, including the address for one of the Blairs' homes hidden inside a white Versace spectacles case. Also found was an Acer laptop computer, a pocket notebook and a USB dongle. Without the knowledge of Incedal, who was unable to see what was going on, the officers took photographs of the evidence but did not remove anything from the vehicle. Incedal was then allowed to go on his way.
Incedal's encounter with the law unsettled him, it is alleged, but he appeared to have no inkling that a bug had been planted, the jury heard.
In the two weeks that followed, Incedal was recorded expressing concern that his alleged plot might have been thwarted.
The court heard that he told his wife: "Made a big mistake. There was some very important stuff in the car. If they found it, we're f*****."
The listening device also recorded him saying: "I hate white people so much. I might have to destroy everything and do something else, Plan B.
"These pigs. I just feel like running them over. Everyone, even the kuffar, call them pigs."
The jury was told that the listening device had picked up a reference to running an illegal house and a suggestion that it was "too dangerous" to carry rucksacks. Snippets of chatter also included references to bin Laden, fatwa, Syria and jihad.
The next time Incedal encountered the police, at 7.12pm on October 13 last year, the circumstances were rather different.
Again his car was stopped, but this time armed officers shot out the tyres of the Mercedes on the approach to Tower Bridge to prevent him trying to drive away as he was arrested on suspicion of terrorism offences.
Once again, the car was searched. Hidden between his iPhone and its protective case was a memory card wrapped in masking tape that contained three files relating to "bomb making", the jury was told.
They included references to latex gloves, goggles, chemicals to use and a description of how to use ground down matchstick heads. There was also a "rather comical" drawing of a bomb going off in the back of a car, said Whittam.
The iPhone had been used to search the internet for "Islamic State of Iraq" in both English and Arabic.
Handwritten notes in a pocket notebook stated: "Fight those of the infidels who are near to you and why do you not fight in Allah's cause for those oppressed men, women and children who cry out 'Lord rescue us from this town'?".
When he was arrested, Incedal gave his home address in Southwark, south London, and said: "Are you going into my address with guns? My wife and kids are there." He failed to mention that he had access to a second address in Bayswater, west London, at which he had been living for some time, Whittam said.
It was there that his Acer laptop was found, as well as the white Versace glasses case and registration documents for the Mercedes.
At Incedal's home address, police found an A4 pad of handwritten notes which primarily referred to the establishment of a kebab shop business, the jury heard.
There was also a reference to "Plan A", which appeared to concern a checklist for a potential operation involving "one-month surveillance", the renting of a nearby flat, transport, uniforms and references to planning, rehearsals, action, resources and route.
A handwritten spider diagram found under the bed included the words security, intelligence, communication and recruitment. Another diagram concerned "secure communications" and "methods to communicate". The trial continues.
Three-part trial
• The entire trial was originally scheduled to be heard in secret, which would have been unprecedented.
• The decision was overturned by the Court of Appeal after a challenge by media organisations, who said open justice was the "hallmark and a safeguard" of the rule of law.
• The Court of Appeal ordered one part of the trial to be heard in open court but other parts cannot be reported.
• A second will be heard in private, and the third will be heard partly in private with a limited number of journalists present on the basis that they may not yet report the evidence.
Next trending article: Scramble to find passengers after US Ebola nurse took flight
