A fanatical teacher plotted a series of Islamic State-inspired attacks on Big Ben, the Queen's Guard, and Westfield shopping centre, saying "we are a death squad sent by Allah", a court heard.
Umar Haque, 25, allegedly enlisted the help and support of fellow extremists at his local mosque where he tried to groom children with role-play and extremist videos.
He also showed pupils as young as 11 videos of beheadings in a bid to "foster and encourage" them into adopting his extreme ideology at the Islamic school where he worked, jurors heard.
Haque became "fascinated" by last year's Westminster Bridge attack and discussed bringing a reign of terror across London in secretly recorded chat, the Old Bailey heard.
In a bugged conversation with one of his co-accused four days after the March 22 attack, Haque allegedly said: "So what I want to personally is launch different attacks in all the different areas, one in Westminster, one in Stratford, one in Forest Gate, one... in so many different areas, yeah.
"Immediately there's one focus to all the police. Get off the streets. Civilians get off the streets. London will be, not just Westminster attack, entire London...
"We're here to cause terror, my brother. We are a death squad sent by Allah and his messengers to avenge my Arab brothers' blood..."
Prosecutor Mark Heywood QC told jurors that in 2016 and early 2017, Haque was set on carrying out one or more violent attacks with others on civilian and police targets.
He said: "Umar Haque was fascinated by the warped and extreme ideology of Islamic State.
"He had identified methods and targets. Those targets were numerous but included for example, the Queen's Guard, the courts, Transport for London, Shia Muslims, Westfield, banks in the City of London, Heathrow, west London, Parliament, Big Ben, the English Defence League or Britain First, embassies, media stations."
Abuthaher Mamun, 19, Muhammad Abid, 27, and Nadeem Patel, 26, who knew Haque through the Ripple Road Mosque in Barking, east London, are accused of helping him.
Mamun assisted with attack planning and set about raising money to fund it through trading in options, Abid was involved in "discussion and lower level of support" while Patel agreed to provide a gun, jurors were told.
In April 2016, Haque came to the attention of authorities when he tried to travel to Turkey from Heathrow, the court heard.
His deadly plans were revealed in bugged conversations in Abid's Volkswagen and home and Haque's Ford Focus the following year, the court heard.
Haque discussed his fears of a "snitch" and justification for killing civilians during a five-hour conversation with Abid in the wake of the Westminster Bridge attack.
He allegedly discussed using a car, leaving bombs in a lift, and going for "a quick spin" around Westminster.
On May 2 last year, talking in his car, Haque allegedly told Mamun that the day IS took Arabia would be like "us winning the World Cup".
Mr Heywood told how Haque taught children aged between 11 and 16 at the Lantern of Knowledge Islamic School in Leyton, east London, between September 2015 and September 2016.
He showed his pupils images of guns, burning of passports and beheadings with a knife or sword to "encourage them into his mindset", Mr Heywood said.
He and Mamum were also heavily involved in running the Ripple Road mosque where Haque assumed the role of "teacher", jurors were told.
In the months before his arrest in early 2017, he "manipulated" the vulnerable children, telling them he intended to die a martyr and IS was "good", the court heard.
He showed them "horrifying" images, including one of a dead boy, saying they would meet the same fate if they did not "join" and promise to become a martyr, the court heard.
Haque allegedly made the children do "push-ups, races and grappling" and act out the roles of police and attackers in scenarios with weapons and a car bomb, while he shouted "Allahu Akhbar".
The defendant swore the children to secrecy, Mr Heywood told jurors: "He said whatever they spoke about in the mosque must stay in the mosque."
Haque and Mamun are joinly charged with preparing acts of terrorism between March 25 and May 18 2017.
Haque is further charged with preparing terrorist acts by leading exercises with children at the mosque and dissemination of terrorist publications at the Lantern of Knowledge school
Abid is accused of having information about Haque's plans and Patel is charged with plotting with Haque to possess a firearm or imitation firearm.
The defendants, who are from east London, have denied the charges.
However, Haque has admitted charges of collection of terrorist information and dissemination of a terrorist publication at the mosque.
And Patel has admitted possessing a prohibited weapon.