Prime Minister Lee Hsien Loong accuses Leong Sze Hian of spreading false claims about him over the article relating to the money-laundering scandal at state fund 1MDB in neighbouring Malaysia.
Critics say the case is the latest example of the tightly-regulated city-state's government being heavy-handed and seeking to silence dissent online.
Singapore's leaders have frequently turned to the courts to take on critics, ranging from political opponents to foreign media outlets, and insist such action is necessary to protect their reputations.
Taking the stand at the start of the trial, Lee accused Leong of making "malicious and baseless" allegations, which had undermined the government's "integrity and honesty".
The article that Leong shared, originally published in a Malaysian news portal, alleged that Lee was the target of an investigation in Malaysia over the 1MDB state fund.
Billions of dollars were looted from the investment vehicle in a scandal that involved Malaysia's former leader Najib Razak and his inner circle.
Lee, 68, also said he suffered damage to his own reputation.
Leong's lawyer Lim Tean argued the libel suit was unnecessary as authorities had denied the allegations, adding the prime minister had "picked on the defendant when there are many others who shared the (defamatory) article".
The case will run until the end of the week.
On Friday, Lim, who is also an opposition politician, was arrested on suspicion of harassment and misappropriating money and claimed the move was politically motivated. Police denied his claim.
Singapore's leaders are sensitive to allegations of graft, but rights groups frequently accuse them of resorting to tough laws to silence criticism.
Last year authorities introduced a law against online misinformation, which empowers ministers to order the blocking of social media posts they deem false, sparking criticism that it would chill free speech.
The Straits Times, reported that Lim Tean arguing that PM Lee had no need to take legal action against his client.
Lim, an opposition politician who heads the Peoples Voice party, told the High Court the Government had already taken sufficient action to debunk the false allegations made against it.
He pointed to statements put out by the Singapore High Commission in Malaysia, Monetary Authority of Singapore and Infocomm and Media Development Authority on the case, as well as remarks made in November 2018 by Law and Home Affairs Minister K. Shanmugam.
All these were widely carried in the mainstream media, said Mr Lim.
He added that the lawsuit against Leong was "really an attempt to protect the integrity of the Government and reputation of the Government, not a genuine libel action for the plaintiff to recover his reputation."
PM Lee had sued Mr Leong over a post the blogger shared on his Facebook page on Nov 7, 2018, which contained a link to an article by Malaysian news site The Coverage.
The article contained allegations that former Malaysian prime minister Najib Razak had signed "secret deals" with PM Lee in exchange for Singapore banks' help in laundering money from scandal-ridden Malaysian state fund 1Malaysia Development Berhad, or 1MDB.
The content of the article had been taken from the States Times Review (STR) site, owned by Singaporean Alex Tan Zhi Xiang who lives in Australia.