After a delay of several minutes, Rajoy began his appearance on Thursday morning by remembering the victims of the train crash on July 24th near Santiago de Compostela.
He thanked the emergency services workers and the people of Angrois and Santiago de Compostela for their support after the accident.
The Spanish leader then cut to the chase and brought up "the so-called Bárcenas case", a case he said had began four years earlier.
Distancing himself from the idea the he had only appeared in Parliament because of pressure from other political parties to do so, he said it was "very important that the Spaniards knew what was going on".
Rajoy told a special hearing of parliament he had come to "refute the lies, manipulations and malicious insinuations encouraged by certain political leaders" over allegations that he received illegal payments from his party.
Rajoy stressed he had already spoken about the Bárcenas case in February and then again in March on numerous occasions.
But apparently "some people hadn't liked" his explanations.
He added it seemed as if some people already knew the truth on the issue.
"Whatever I say, people will ask for my resignation," said the Spanish Prime Minister.
"I made a mistake in maintaining confidence in someone who we now know did not deserve it," Rajoy told lawmakers, after having resisted for months to even pronounce Barcenas' name in public.
However, he refused to resign.
"Nothing related to this matter has prevented me, nor will it prevent me from governing," he said.Rajoy went on to say of the ex-treasurer of his party: "I made a mistake in trusting someone who didn't deserve that trust."
"I believed in his innocence, he tricked me".
The Spanish PM said Bárcenas had tried to turn the spotlight on the PP but that all of his accusations were false.
He went on to say that In the PP, they handed out bonuses for work done, which is "what happens everywhere".
The comment was booed by the opposition benches.
Addressing the issue of whether he personally received under-the-table payments, Rajoy said his tax declarations were a matter for the public record.
"I believe all (my words) have more value than a one line written on a crumpled up piece of paper," said Rajoy referring to the so-called Bárcenas papers which the ex-treasurers says demonstrate he gave handouts to top PP officials.
The Prime Minister said it was up to the judges to establish the truth about the Bárcenas case.
Rajoy slammed those people who made unfounded accusations about the case and stressed everyone was "innocent until proven guilty".
He also said it wasn't his responsibility to respond to every accusation and insinuation.
"Don't threaten me Mr Rubalcaba," the Spanish leader said referring to a motion of censure put forward by the leader of the opposition.
"Why do you sabotage the trust that Spain has earned in the (financial) markets?"
Rajoy said the Parliament was there to protect financial assets "which are not yours, Mr Rubalcaba, or mine,".
Rajoy stressed he wouldn't change his economic road map and would stick to his reform programme.
"We won't let Bárcenas dictate the future of Spanish politics."
He said the judges had the full support of the government and could continue to do their work without pressure.
Rajoy said he wanted the corruption issue cleared up as quickly as possible.
He added it was vital that Spanish politics were clean at a time when the people in the country were making such large sacrifices.
He then went on to list a number of anti-corruption measures approved by the Spanish government.
More to follow.