"I will never, never, never surrender. Zimbabwe is mine, I am a Zimbabwean. Zimbabwe for Zimbabweans. Zimbabwe never for the British, Britain for the British," Mugabe told his party’s annual conference.
The veteran leader said he would remain until "his people decide to change him".
Mugabe also denounced Western governments who have been stepping up their criticism of his regime since the outbreak of cholera in the country, which according to UN figures has so far killed more than 1 100 people.
"What a pack of lies," he said. Zimbabwe was facing a war with former colonial power Britain, supported by the United States and Europe.
"I won’t be intimidated. Even if I am threatened with beheading, I believe this and nothing will ever move me from it: Zimbabwe belongs to us, not the British."
He also commented on deadlocked talks to form a unity government with Morgan Tsvangirai and his Movement for Democratic Change (MDC) and Arthur Mutambara, the leader of a smaller MDC splinter faction.
"I don’t know whether this inclusive government is going to work or not. I have sent letters inviting the two so that I can swear them in," said Mugabe.
But he warned that they would wait in vain to see his regime collapse.
"If they want to wait they can wait. That day will never come."
The veteran leader warned against internal divisions at the party’s annual national conference, telling delegates that they should not abandon Zanu-PF if they were disgruntled.
"You chose me to be your presidential candidate for the March elections. Some said don’t vote for the president. This was a contest between various parties and if your presidential candidate lost it meant you lost as a party."
Earlier on Friday, Nordic countries Denmark, Finland, Iceland, Norway and Sweden added their voice to calls from several world leaders for him to step down, holding him responsible for the chaos in his country.
Mugabe, who has ruled the former British colony since independence in 1980, lost to political rival Tsvangirai in March elections. But Tsvangirai withdrew from a presidential run-off in June, citing violence against his supporters.
The two leaders signed a power-sharing deal in September that has yet to be implemented amid disagreements over who should control key ministries.
Zimbabwe, once a model economy in Africa, is struggling with inflation of about 231-million percent, desperate food shortages and chronic political instability.
‘We’re dealing with the failure of a regime’
Meanwhile, British Prime Minister Gordon Brown called on Southern African leaders on Friday to distance themselves from Mugabe and called the deteriorating situation there a "tragedy".
Zimbabwe’s neighbours had to make clear their backing for the country’s MDC, which won first-round presidential elections earlier this year, said Brown.
"Zimbabwe continues to be a tragedy," he told reporters at his monthly press conference in London.
"The situation, contrary to what President Mugabe says, from all the evidence we have, is deteriorating and deteriorating rapidly," he said.
"My call over the next few days is to the Southern African governments to work with us to make sure, first of all that we get the humanitarian aid into Zimbabwe, to help people," he said.
Secondly he urged African leaders to "make sure that it is absolutely clear to the people of Zimbabwe that we support those who are the democratically elected politicians", he added.
Mugabe has come under increasing pressure from world leaders to step down in recent weeks.
Brown said the cholera epidemic highlighted how Mugabe’s government was failing.
"We now know that the methods being used to treat the disease are antiquated, and that they cannot bring the hope and the health to people who are suffering," he said.
"We’re dealing with the failure of a regime." — AFP