It is the first verdict he has received since his ousting and is one of several trials he faces.
Morsi was deposed by the army in July 2013 following mass street protests against his rule.
Since then, the authorities have banned his Muslim Brotherhood movement and arrested thousands of his supporters.
Morsi and 14 other Brotherhood figures escaped a more serious charge of inciting the killing of protesters, which could have carried the death sentence.
Most of the other defendants were also given 20-year prison sentences.
This court case is one of several trials Mr Morsi faces. They include:
- Colluding with foreign militants in a plot to free Islamists in mass prison breaks during the 2011 uprising against Hosni Mubarak
- Espionage and conspiring to commit terrorist acts in Egypt with the Palestinian movement Hamas, Lebanon’s Hezbollah and Iran’s Revolutionary Guards
- Endangering national security by leaking state secrets and sensitive documents to Qatar via the Doha-based Al Jazeera network
The group stood accused of inciting supporters to kill a journalist and opposition protesters in clashes outside the presidential palace in late 2012.
As crowds grew outside the palace, Morsi ordered the police to disperse them.
They refused, so the Muslim Brotherhood brought in their own supporters. Eleven people died in the ensuing clashes, mostly from the Brotherhood.
Hearing the verdict, Morsi and the other defendants gave a four-fingered salute, a symbol of the deadly clearance of Brotherhood supporters at the Rabaah al-Adawiya mosque in 2013, AP reports.
Morsi himself has rejected the authority of the courts, shouting during his first trial that he was the victim of a military coup.
On Monday, a court sentenced 22 Muslim Brotherhood supporters to death for an attack on a police station in Cairo, part of an ongoing crackdown against the Islamist movement.
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