By Yasmine Saleh and Hadeel Al Shalchi

CAIRO, Nov 4 (Reuters) - Egypt began the trial of ousted president Mohamed Mursi on Monday in what opponents of the army-backed government say is part of a campaign to crush his Muslim Brotherhood movement and revive a police state.

It is the second time in just over two years that an overthrown president has been in court in Egypt, a nation said by government critics to have reverted to authoritarian rule.

State television said a court set up at a Cairo police academy had begun trying Mursi and 14 other Islamists charged with inciting violence.

The trial is not being aired on state television and journalists were barred from bringing their telephones into the courtroom set up in a Cairo police academy.

The now-banned Muslim Brotherhood has said it will not abandon street protests to pressure the army, which toppled Mursi on July 3 after mass demonstrations against his rule, to reinstate him.

But a heavy security presence across the country served as a reminder of a crackdown in which hundreds of Mursi supporters were killed and thousands more rounded up.

The uprising that toppled Hosni Mubarak in 2011 had raised hopes that Egypt would embrace democracy and human rights and eventually enjoy economic prosperity.

Instead, the power struggle between the Brotherhood and the army-backed government has created more uncertainty in the U.S.-allied country of 85 million, which has a peace treaty with Israel and controls the Suez Canal, a vital global trade route.

The trial of Mursi is likely to be the next flashpoint in their confrontation, which has hammered tourism and investment.

He and the other defendants face charges of inciting violence relating to the deaths of about a dozen people in clashes outside the presidential palace in December after Mursi enraged his opponents with a decree expanding his powers.

The defendants could face a life sentence or death penalty if found guilty.

Mursi travelled to the heavily guarded courthouse from an undisclosed location by helicopter, state media said. The trial is taking place in the same venue where Mubarak has also been facing trial for complicity in killing protesters.

Hundreds of Mursi supporters gathered outside the building to pledge their support for him. One sign read "The will of the people has been raped", a reference to the army takeover which followed mass protests against Mursi's rule.

Tahrir Square, where Egyptian protesters had gathered during the uprising against Mubarak, and later Mursi, was sealed off by army personnel carriers and barbed wire.

Traffic was light in the usually bustling Cairo, suggesting many stayed home for fear of violence.

The Brotherhood had won every election since Mubarak's fall and eventually propelled Mursi into power after the Islamist movement endured repression under one dictator after another.

But millions of Egyptians who grew disillusioned with Mursi's troubled one-year rule took to the streets this summer to demand his resignation.

Egyptians accused Mursi of usurping power and mismanaging the economy, allegations he denied.

"We didn't see as much misery in the 30 years of Mubarak as much as we saw in one year of Mursi," said Ali, a driver who was sipping morning tea at a cafe in downtown Cairo.

"He fooled us with his year in power. I feel a huge burden is being lifted today."

The army, saying it was responding to the will of the people, deposed him and announced a political roadmap it said would lead to free and fair elections.

But the promises have not reassured Egypt's Western allies, who had hoped the stranglehold of military men would be broken.

CALL FOR PROTESTS

On the eve of Mursi's trial, Al Watan newspaper released a video on its website of what it said was him speaking to unidentified individuals during his incarceration.

Dressed in a tracksuit, Mursi said his ouster was "a crime in every way". Al Watan did not say when the video was taken.

The Brotherhood has called on its supporters to stage mass protests on Monday, but the size of their demonstrations has shrunk because of heavy policing.

The Brotherhood's press office in London rejected the trial and charges against Mursi and demanded a fresh investigation.

Speaking to a local television channel, Interior Minister Mohamed Ibrahim warned the group: "If the Brotherhood commit any violations, they will regret it."

Riot police crushed two pro-Mursi protest camps on Aug. 14, and hundreds of Islamists have been killed and thousands arrested, including the Brotherhood's top leaders.

Egypt's oldest and most influential Islamist group has also been banned and its funds seized. Army chief Abdel Fattah al-Sisi, who toppled Mursi, has become immensely popular. Few doubt his victory if he runs for president.

The Brotherhood maintains Mursi's removal was a coup that reversed the democratic gains made after Mubarak's overthrow.

"It is clear that the goal of this trial as well as any action against the Muslim Brotherhood is to wipe out the group as well as any Islamist movements from political life," said Mohamed Damaty, a volunteer defence lawyer for Mursi.

Amnesty International said the trial was a "test for the Egyptian authorities" who should grant Mursi a fair trial.

In the most senior visit to Cairo by a U.S. official since Mursi's fall, Secretary of State John Kerry also called for a fair, transparent trial for all Egyptians.

Egyptian officials admit the path to democracy has been rocky, but say a proper political transformation will take time.

Egypt has also faced a sharp escalation of attacks by Islamist militants in the Sinai Peninsula. Security forces are attacked almost daily.

Speaking to Reuters by phone, Osama Mursi, the deposed president's 30-year-old son, said his father had not authorised a defence lawyer and the family would not attend the trial. "We do not acknowledge the trial. We are proud of my father and feel strong about his position."