British-born Islamic militant Mr Ahmed Omar Saeed Sheikh and three co-defendants have denied the kidnap and murder of Wall Street Journalreporter Mr Daniel Pearl.
Journalists and members of the public are not allowed inside the proceedings, but a source from inside the makeshift courtroom in the Karachi Central Jail reported the plea.
It had been uncertain if Saeed would enter a plea because he had previously said he did not recognise Pakistan's "British" secular court system and demanded to be tried by an Islamic court.
The trial began under tight security in the jail where Mr Saeed and the three others are held on charges of murder, kidnapping and terrorism. They face the death penalty if convicted.
Police snipers manned positions in guard towers and on top of buildings as the judge and prosecutors arrived shortly before the proceedings began.
There are fears associates of the suspects might try to free them or even kill them.