Michael Campbell was jailed for 12 years by a judge in Lithuania who had seen secretly-recorded videos of the 39-year-old negotiating to buy weapons unaware that he had been set up by the UK intelligence agency, working alongside Lithuanian authorities.
The court was told Campbell paid up to €10,000 (£8,700) for the cache, which included rocket-propelled grenades, detonators, a high-powered sniper rifle and 12kg of Russian-made explosives.
He thought he was buying the shipment from a Lithuanian arms dealer, but the episode was a sting set up by undercover MI5 and Lithuanian agents in an operation that had been going on for four years.
Campbell, who was arrested in January 2008, was convicted of three charges – attempting to buy weapons, attempting to smuggle them and providing support for a terrorist group.
The chief prosecutor, Irmantas Mikelionis, said: "The evidence acquired during the investigation proves that the weapons and explosives would have been used for terrorist attacks and [the] killing of innocent people in the UK.
"There was also a plan to organise, in Lithuania, the training of Real IRA members on how to use the weaponry."
He said the investigation was unusual and complicated, and added: "They planned to use this weaponry against the UK police or military officers or their vehicles. The information we have proves that the explosives could have been used for bombing in London. If we failed to stop Michael Campbell, we would put in danger the lives of innocent people."
The court was told that alleged members of the Real IRA had asked a businessman with interests in eastern Europe whether he knew anyone who could supply arms.
They were unaware that this go-between, who was called Robert Jardine in court, was an MI5 agent who had been recruited in 2002. Jardine introduced alleged members of the Real IRA to contacts in Lithuania who said they could supply the guns and ammunition they were looking for.
All the contacts were either undercover British or Lithuanian "role players", and many of their meetings were recorded.
Campbell was sent to Lithuania to negotiate the deal on behalf of the dissidents, the court heard. He was filmed discussing the terms.
The judge, Arunas Kisielius, was shown footage in which Campbell asked whether certain detonators could be used for boobytrap car bombs and said he wanted the weapons to target "Brits".
Prosecutors said Campbell was particularly keen to buy a Barrett sniper rifle with a range of more than a mile. Asked to reveal which organisation he represented, Campbell replied: "IRA."
During the trial, the first anti-terror case brought in Lithuania, 11 Lithuanian and British undercover agents gave evidence via videolink.
Gedgaudas Norkunas, prosecuting, said: "All the evidence we have makes us think that this was not entrapment. If these criminal acts had not been discovered in a timely way, weapons would have been acquired from other sources and used for terrorist purposes."
The court was told Campbell was intending to buy the weapons for his older brother, Liam, said to be a founder of the Real IRA.
Liam Campbell was one of four men found liable in a civil trial of being involved in the 1998 Omagh bombing in which 29 people were killed. He is in custody in Belfast, battling attempts to have him extradited to Lithuania.
In his defence, Michael Campbell, from Dundalk, Co Louth, insisted he was not a member of the Real IRA and said he had been entrapped by British, Irish and Lithuanian intelligence agencies who had initiated the arms deal.
He admitted being in Lithuania to buy weapons, but said they were not intended for use by terrorists. He pleaded not guilty to charges of attempted arms smuggling, supporting a terrorist group and illegal possession of weapons.
His lawyer, Ingrida Botyriene, said: "He would never be involved in arms deals and would never go to Lithuania for such an affair if he had not been provoked by secret agents."
Campbell could appeal against conviction. Having served three years in prison, he may be freed in four and a half years.