The comments, made in a lecture at the University of Regensburg during a visit to his native Bavaria in southern Germany, were couched in a historical reference to a 14th century Byzantine emperor.
"He said, I quote, 'Show me just what Mohammed brought that was new, and there you will find things only evil and inhuman, such as his command to spread by the sword the faith he preached,'" Pope Benedict said, quoting the Byzantine source on the Prophet Mohammed, founder of the Muslim faith.
During his lecture Pope Benedict made it clear that he was quoting someone else's words but did not specify whether he agreed with them, instead calling them "brusque".
"We hope that the [Roman Catholic] Church will very quickly... clarify its position so that it does not confuse Islam, which is a revealed religion, with Islamism, which is not a religion but a political ideology," the head of the French Council for the Muslim Religion (CFCM), Dalil Boubakeur said.
"It is a statement full of enmity and grudge," said Ali Bardakoglu, the head of Turkey's state-run religious affairs directorate. He also expressed opposition to the pope's planned visit to Turkey in November.
Senior Islamic officials in Kuwait and Egypt demanded an immediate apology. Hakem al-Mutairi, secretary general of Kuwait's Umma (Islamic Nation) party, urged Muslim countries to recall their ambassadors from the Vatican until the pope apologised for what Mr Mutairi called his "calumnies" against Islam.
Several Islamic parties in Pakistan expressed their regret at the pope's comments, and the 57-nation Organisation of the Islamic Conference in Jeddah called on the Vatican to clarify its "true position on Islam and its precepts".
The pope's official spokesman later issued a response to the outcry, saying that Pope Benedict respected Islam but rejected violence motivated by religion.
"It was certainly not the intention of the Holy Father to do an in-depth study of jihad and Muslim thinking in this field and still less so to hurt the feelings of Muslim believers," said Federico Lombardi, head of the Vatican's press department.
Muslims also objected to another part of the lecture, in which Benedict quoted a scholar's assertion that the Muslim view of God, unlike the Christian, was not informed by the Greek-inspired western philosophical tradition of "rationality".
“Deep crisis”
A member of the Moroccan parliament, Abdelilah Benkirane said that this claim was "an offence to a billion Muslims".
Justo Balda Lacunza, a Vatican-based priest specialising in Islamic affairs, said the speech was not intended to look unfavourably on Islam, but was an "examination" of the relationship between violence and faith.
The comments have also drawn criticism from a leading Muslim figure in Italy. Ejaz Ahmad, a member of a governmental consultative committee on Islam, called on Pope Benedict to retract his statement.
"The Muslim world is currently undergoing a deep crisis," Mr Ahmad was quoted as saying by the ANSA news agency. "Any attack from the West can aggravate this crisis."
But Yussef al-Qardawi, a widely respected Muslim cleric who belongs to the Muslim Brotherhood, said, "This is not the first time this pope has adopted a negative attitude towards Islam and Muslims."
"Does the pope want to close the door on dialogue and new crusades to be readied?" the Cleric added.