Christopher Reyes Gonzaga, 45, is accused of murdering Gregory Tan, 45, in an empty home in western Melbourne in 2024.
As his Victorian Supreme Court trial began on Monday, a jury was shown CCTV of yells and thumping noises ringing out through the quiet suburban neighbourhood of Deer Park in the early hours of April 15.
Mr Tan suffered extensive injuries including to his jugular, carotid artery and skull, the Crown alleged.
One cut extended from his left ear to his mouth.
His right hand was partially severed in what the prosecution alleged was a defensive wound.
"(Mr Tan) tried to defend himself while the accused was striking him in the head with the machete," prosecutor Penelope Thorp told jurors in her opening address.
Gonzaga has pleaded not guilty to the murder, earlier telling police Mr Tan had threatened him with a screwdriver and that he was acting in self-defence.
The pair had been friends for some time and witnesses reported seeing them use drugs together on multiple occasions, the court was told.
Prosecutors allege Gonzaga lit two fires in the home after hacking his friend to death, before leaving and throwing the machete in a drain.
He then called triple zero to report the fire and was arrested.
Mr Tan had lived next door with his brother, both their partners and another friend.
The home in which he died was empty following the death of the previous resident, jurors were told.
Prior to his arrest, Gonzaga was captured on CCTV crouching down behind a car parked in a driveway, at which time Ms Thorp alleged jurors would see he did not have any injuries to his face.
She alleged a gash on Gonzaga's forehead at the time of his arrest had been self-inflicted moments prior.
While in custody, Gonzaga admitted stabbing Mr Tan and accused him and others of having killed the resident of the house they were in, by overdosing her in order to rob her.
"There's a guy there who's also cut," Gonzaga said to police, the court was told on Monday.
"Unfortunately, I made friends with the wrong people."
Gonzaga's barrister, John Lavery, will make an opening address to the jury on Tuesday morning.
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