Yoon was apprehended Wednesday as part of an investigation into alleged insurrection and abuse of power.
The Corruption Investigation Office for High-Ranking Officials (CIO) filed for a court warrant for Yoon’s formal arrest Friday before his 48-hour detention expired.
If granted, the warrant would allow investigators to hold Yoon for up to 20 days before indictment.
The Seoul Western District Court began the hearing at 2 p.m. Its decision is expected late Saturday or early Sunday.
Yoon, South Korea's first president arrested while in office, arrived at the court at 1:54 p.m. with eight lawyers.
He was taken directly from the Seoul Detention Center to the courtroom, bypassing the usual photo line for suspects.
Outside the court, more than 36,000 supporters of Yoon rallied, waving Korean and U.S. flags and chanting, "Impeachment invalid," and "Release the president!"
Police clashed with protesters who tried to breach the courthouse. Officers detained 17 demonstrators who scaled the wall and entered court grounds.
"The president accepted his lawyers' advice that he should appear in court and respond with dignity," said Yoon Gap-geun, one of his legal representatives.
The lawyer said Yoon is concerned about the ministers, generals and police chiefs arrested over the martial law operations.
“He wishes to restore his honor by explaining the legitimacy of the martial law declaration and refuting the charges of insurrection in court and at the Constitutional Court,” he said.
Yoon's legal team initially said Friday he would skip the hearing, arguing the arrest warrant falls under Seoul Central District Court jurisdiction.
The measure was lifted six hours later after lawmakers voted against it. The National Assembly impeached Yoon on Dec. 14.
The CIO argues Yoon's actions disrupted constitutional order and that detention is needed to prevent evidence tampering or flight risk.
His defense team maintains the martial law declaration was a legitimate use of presidential power during what they call a national emergency caused by opposition parties' obstruction and impeachment of cabinet members.
Yoon was apprehended at his official residence in Seoul on Wednesday and remained silent during 10 hours of initial questioning. He has since been held at the detention center, refusing further questioning.
He is the first sitting South Korean president to attend a pretrial detention hearing since its 1997 introduction.
Former President Park Geun-hye, who faced corruption and abuse-of-power charges, attended a warrant hearing in 2017 after leaving office.
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