The trial before the international tribunal in this Dutch city resumed following a six-month break, having been adjourned in June after Taylor boycotted proceedings and fired his lawyer.
Back in court, Taylor looked confident and blew a kiss to supporters in the gallery as his new lawyers challenged the prosecution to prove that he was behind the widespread murder, rape and amputations during Sierra Leone's civil war.
Prosecutors allege the so-called "blood diamonds" mined in Sierra Leone were smuggled through neighboring Liberia and that Taylor used the profits to arm the rebels. Taylor, 59, is accused of orchestrating the violence from his presidential palace in Liberia's capital, Monrovia. He has pleaded innocent to all 11 charges.
He is the first former African head of state to face an international tribunal.
The opening testimony came from Ian Smillie, a Canadian expert on conflict diamonds. He said miners, many of them kidnapped and enslaved by Sierra Leone's Revolutionary United Front, or RUF, dug up diamonds worth between $60 million and $125 million each year.
Smillie interviewed Taylor as part of a U.N. team that investigated arms smuggling in Liberia in 2000. In that interview, Taylor conceded that Sierra Leone diamonds likely were being smuggled in and out of Liberia, but denied involvement.
However, Smillie said he stood by the findings of his team's report and read out a summary that was included in a 2001 U.N. Security Council resolution imposing sanctions on Taylor's regime.
The resolution said that diamonds smuggled through Liberia were the key source of RUF income "and that such illicit trade cannot be conducted without the permission and involvement of Liberian government officials at the highest levels," Smillie told judges.
He also explained why the chopping off of hands was turned into the signature atrocity of the 10-year Sierra Leone civil war that ended in 2003 - "to create such a fear of the RUF that the areas would be cleared for them to do whatever they wanted, including diamond mining and foraging for supplies."
Fleeting video images of maimed victims cast a grim shadow over the courtroom - a woman who said she was sexually assaulted with a stick by a rebel and then saw her husband staggering out of the jungle with blood spurting from the stumps of his arms; a boy who described being kidnapped and forced to mine diamonds, a man with no hands who said his wife and children were burned to death by militias.
Taylor's attorneys objected to Smillie being portrayed as an expert on Sierra Leone history and to the video images. The three judges agreed Smillie should not be allowed to testify about atrocities and said they will rule later on whether to admit the videos.
"I think they're desperate," Taylor's lead attorney Courtenay Griffiths said of the prosecutors. "Let us now see what the firm concrete evidence is that he was directly involved in ordering the atrocities in Sierra Leone."
Elise Keppler of Human Rights Watch welcomed the resumption of the trial.
"This is a huge moment, as a former head of state is being tried for these most serious crimes," she said.
Prosecutors have 144 witnesses, but only expect to call half of them to appear. The trial is expected to last nearly two years.
The second witness scheduled to testify - likely Tuesday - was a victim of the militias. The defense does not deny the atrocities happened, and says calling victims to testify is an unwarranted play for the judges' sympathy.
Later in the week, a former member of Taylor's inner circle will testify about how the former Liberian president allegedly controlled and encouraged Sierra Leone militias, the prosecution says.
In Monrovia, hundreds of pro-Taylor Liberians gathered for prayers before a mammoth poster of the ex-president Sunday night.
"We strongly believe in the innocence of the accused," Baptist preacher Joseph Johnson told the congregation.
Taylor's support in his home country is led by his family, who say he was not in control of those that carried out the crimes.