It was the first formal legal action by Yemen against Anwar al-Awlaki, and came as the country faces heavy pressure to crack down on the terror network following the interception of two mail bombs intercepted in Dubai and Britain last week.
Yemen's move isn't likely to affect a possible U.S. decision to itself charge the cleric, since Washington doesn't believe Yemen is reliable at holding its prisoners, especially after a number of high profile defendants were released into the custody of their tribes.
Prosecutor Ali al-Saneaa announced the charges against al-Awlaki as part of a trial against another man, Hisham Assem, who has been accused of killing a Frenchman in an Oct. 6 attack at an oil firm's compound where he worked as a security guard.
Assem, 19, was present in court, but al-Awlaki and a third suspect, Osman al-Awlaki, were charged in absentia. The hearing was held amid tight security measures at a courthouse in downtown San'a.
Al-Awlaki, who was born in New Mexico, is based in Yemen. U.S. investigators say e-mails link him to the Army psychiatrist accused of last year's killings at Fort Hood, Texas. They also say that he helped prepare Nigerian Umar Farouk Abdulmutallab, accused in the Christmas airline bombing attempt, and that he had links to the failed Times Square bombing.
The U.S. has put Al-Awlaki, whose English-language sermons advocating jihad, or holy war, have inspired a number of Western-born militants, on a list of militants it wants killed or captured.
Al-Awlaki is believed to be living in a mountainous region of Yemen, sheltered by his family and tribal religious leaders who say he has no ties to terrorism. Yemeni officials have said they will not turn him over to the U.S. because, as a Yemeni citizen, he must be prosecuted there.
In September, Abdulmutallab suggested in Detroit federal court that he was ready to plead guilty to some charges, raising the possibility that his cooperation could form the foundation for a U.S. case against al-Awlaki.
The Obama administration has rewritten the nation's counterterrorism strategy so that it is also a legal matter to be settled in court. Charging al-Awlaki in the U.S. would also make it easier for the U.S. to demand he be turned over.
The prosecutor in Tuesday's trial said Assem, a guard at the French engineering firm SPIE, had acknowledged that he received Internet messages from al-Awlaki inciting him to kill foreigners with whom he was working.
Assem, who appeared at Tuesday's hearing wearing a blue prison overall, told interrogators that al-Awlaki convinced him that foreigners are "occupiers," and sent him audiotapes with sermons justifying the killing of foreigners when he hesitated, according to the prosecutor.
On the date of the attack at SPIE, Assem followed a French manager and shot him dead in his office, then looked for other foreigners to kill, al-Saneaa said. Assem also shot at a British man, wounding him in the foot, the prosecutor added.
Assem denied all the charges and said he was tortured and forced to give false confessions.
The prosecutor said Assem was put in indirect contact with Anwar al-Awlaki through e-mails he sent to Osman al-Awlaki, a cousin of the wanted cleric.
The proceedings were then adjourned until Saturday to give prosecutors time to publish an announcement in the local papers notifying al-Awlaki and the third suspect of the charges against them and to assign a lawyer for Assem.
After Friday's discovery of the two mail bombs that originated in Yemen, the U.S. and its allies on Monday further tightened scrutiny of shipments from the Arabian Peninsula country. Germany's aviation authority on Monday extended its ban on air cargo from Yemen to include passenger flights.
A Yemeni government official in a statement Tuesday expressed "sorrow and astonishment" at Germany's decision, describing it as "a mass punishment."
The official also said that such a "rushed and exaggerated reaction to suspicious packages will harm Yemen's efforts in combating terrorism and serves no one but al-Qaida terrorists who always sought to ... hurt Yemen's interests, reputation and relations with regional and international friends and partners."
The statement did not identify the official, a common practice with the Yemeni government.
Matt Apuzzo in Washington, DC contrubtion to this report.