The move prompted a furious response from Anwar's lawyer, Karpal Singh, who described the claim as "scandalous".
Anwar was brought into the courtroom in a wheelchair and neck brace. He is seeking bail he says partly to travel abroad for treatment for a back injury allegedly sustained when he was beaten up in custody.
Family members hugged and kissed him, as about 200 supporters outside the courtroom chanted "reformasi", his popular battle cry for political change.
While the need for surgery for a slipped disc is high on the list of arguments for bail, his lawyers are also pressing the case on the basis that Anwar's Federal Court appeal against his nine-year sentence for a sodomy conviction has not yet been heard.
No date for the hearing has been set, and his lawyers say he is entitled to bail as he has already completed his sentence on a corruption charge.
No Security Threat
"There is no evidence that the applicant (Anwar) will embark on a spree of offences if bail is allowed," said Karpal. "This paragraph is scandalous. It ought to be expunged. I cannot see how he is considered a security threat."
The paragraph in the government affidavit said: "The possibility of the applicant being involved in any act violating the law if he is released on bail is something which cannot be assured of at this time as it involves the future which no one can determine."
Anwar claims he was sacked and later charged with sodomy and corruption to prevent a political challenge to Mahathir.
Karpal reminded the panel of three judges, headed by Judge Pajan Singh Gill, that Anwar had been imprisoned for the past four years and that his appeal to the Federal Court could take some two years to be heard.
Call for mercy
"What if Anwar succeeds in the end? Why not, this man was once prime minister in waiting," Anwar's lawyer argued. "Why must prosecutors in the case of Anwar go out of the way to oppose bail?"
Karpal assured the court that his client would not jump bail. "Why should he abscond? He stood his ground when Prime Minister Mahathir Mohamad expelled him in 1998."
The lawyer said Anwar was still having severe back pain and should be allowed to go abroad for treatment. "He is still on painkillers. Cannot this court show some mercy?"
The two-day bail hearing continues on Wednesday.