The England defender came face to face in court with Queens Park Rangers defender Anton Ferdinand, whom he is accused of racially abusing during a Premier League match in October.
The 31-year-old Terry faces a maximum fine of 2,500 pounds ($3,900) if he becomes the first top football player in England convicted of racial abuse during a game.
Ferdinand, who is black, gave evidence that he had not initially heard Terry use racist language during the game at Loftus Road.
Ferdinand said he became aware of the apparent racial slur from YouTube footage. Ferdinand said he would have reported the remarks to game officials if he realized what had been said.
“When someone brings your color into (abuse), it takes it to another level and it’s very hurtful,” Ferdinand said.
Ferdinand told Westminster Magistrates’ Court that his initial intention was not to ensure Terry faced a criminal prosecution as he thought it was a matter for England’s Football Association.
But he later changed his mind and went to the police, a decision he says that wasn’t influenced by his management team.
“I made up my own mind, I wanted to do it,” said Ferdinand, the brother of Manchester United defender Rio.
Terry sat in the dock at Westminster Magistrates’ Court behind a screen opposite Ferdinand, occasionally looking up and spending most of the time making notes.
Prosecutors opened the trial by saying Terry’s comments were “uttered by way of sarcastic exclamation or inquiry in relation to a perceived false accusation made by Mr. Ferdinand” to the effect that the defendant had used a racial expletive.