With François Hollande the clear leader in the polls, the televised debate was the president’s last chance to swing the election in his favour.
Mr Sarkozy said he was being unfairly blamed for France’s economic problems, saying he was not “the only guilty one”.
But Mr Hollande said the French electorate would have little sympathy for the president’s protests, saying: “Mr Sarkozy, you would have a hard time passing for a victim. It’s never your fault. You always have a scapegoat: ‘It’s not me, it’s the crisis that hit me’.”
“It’s a lie! It’s a lie!” Mr Sarkozy repeated during an exchange on economic policies. The Socialist contender also repeatedly denied some of Mr Sarkozy’s claims, insisting, “I never said that.”
It is the only time the two have faced off in the campaign, which has largely focused on domestic issues such as the weak economy, immigration and integration of French Muslims. Yet the outcome is considered crucial to the rest of Europe as well, because France is a major economic engine at a time when the eurozone is trying to climb out of a debt crisis.
Mr Sarkozy says France needs to do more to cut spending and debts, while Mr Hollande favours government-funded stimulus programmes. Both have pushed for similar approaches for the rest of the continent as well.
Mr Sarkozy lashed at out at his critics, especially regarding his handling of the economy, while noting Mr Hollande’s lack of government experience.
Mr Hollande called for national unity and social justice, repeatedly using one of his catchwords rassemblement, “bringing together”, to stress the contrast between him and the divisive Sarkozy.
“You are incapable of maintaining a reasoning without being disagreeable with your interlocutor,” Mr Hollande said.
Mr Sarkozy said his challenger’s economic plans would send France’s debt through the roof and hurt the rest of Europe.
Mr Hollande criticised the tax reforms under Mr Sarkozy, seen by leftists as too friendly to the rich. “We are coming out of five years where France was struck down, where France was divided,” he said.
Mr Sarkozy countered: “Saying that we offered gifts to the rich … is slander. It’s a lie.”
Both the Socialists and conservatives have sought ways to lure voters who during the first round cast their ballots for Marine Le Pen, the leader of the far-right National Front. Ms Le Pen won a stunning 18 per cent of the first-round vote.
Mr Sarkozy denounced those who compared him to France’s Nazi collaborators because of his tough campaign rhetoric on immigrants, or to billion-euro investment swindler Bernard Madoff.
“Borders are not a bad word,” Mr Sarkozy said about his calls to limit the number of immigrants France takes in.
Mr Hollande, meanwhile, took a similar position to Mr Sarkozy – and an unusually firm one for a leftist in France – when it came to special treatment for France’s large Muslim community.
He said he would not allow separate menus in public cafeterias or separate hours in swimming pools for men and women to satisfy Muslims’ demands, and said he would firmly support France’s ban on the face-covering Islamic veils.