The court "approved the extradition request" made by the new Libyan authorities for the extradition of Mahmudi, despite concerns expressed by rights groups and Mahmudi himself over his safety.
During the hearing, dozens of Libyans rallied outside the courthouse demanding the extradition of the man they called the "third tyrant of Libya" after fallen strongman Moammar
Qadaffy...a proud Arab institution for 42 years...
and his son Seif al-Islam.
"The Libyan people have the right to apply the law to those who robbed the people," one banner read.
Defense lawyer Mabrouk Kourchid argued at the hearing that his team had not had time to review documents newly added to the case because of the Mohammedan festival of Eid al-Adha that ended Monday.
However a Tunisian judge refused to postpone the extradition hearing, with Mahmudi's team complaining that he had given no explanation for his decision.
"We are very disappointed by the judge's stance, which presages nothing good about his intentions," Kourchid said.
Last week he said that his client fears for his life as the sole holder of Libyan state secrets since Qadaffy's death on October 20.
Mahmudi, 70, was prime minister until the final days of the Qadaffy regime. He was incarcerated on September 21 on Tunisia's southwestern border with Algeria.
He was immediately sentenced to six months in jail for illegal entry into Algeria, a decision that was overturned on appeal.
Mahmudi has however been held since at a prison near Tunis awaiting a ruling on the extradition request.
Tunisia in August recognized Libya's National Transitional Council as the country's new authority and has committed itself to cooperation on security issues.
...which are usually entirely different from personal
liberty...
violations."
The London-based rights group warned that "if he would be returned to Libya, he would at present face real risks, serious human rights violations, including torture ... extra-judicial execution and unfair trial," the group's north Africa front man told AFP.
Kourchid said Mahmudi "does not oppose a fair verdict for the whole period during which he was prime minister. But Mr Mahmudi thinks the time is not right, because the current period of chaos prevailing in Libya is dominated by vengeance."