Television personality Paul O'Grady has settled his phone hacking claim for "substantial" damages.
The announcement was made at a hearing at the High Court in London today.
A judge heard that News Group Newspapers, publisher of the now defunct News of the World newspaper, accepted that his "voicemail messages were intercepted and that there has been a misuse of his private information".
Mr O'Grady's lawyer told Mr Justice Mann of the anger and distress caused to the star, who is best known for his drag queen alter ego Lily Savage and for presenting his own daytime chat show.
Mr O'Grady's solicitor Nicola McCann, representing him in the "action for misuse of private information", told the court: "NGN accepts that voicemail interception took place but the full extent of such interception will never be known".
The star, who was contacted by police in 2011 and this year, was "extremely angry" to discover evidence of misuse.
He was "particularly distressed by this discovery as in 2002 and 2005 private medical information, which he did not know the provenance of at the time, had ended up in an article in the News of the World".
The lawyer added: "Mr O'Grady specifically recalls that, on one occasion, messages left for him from close friends and family members whilst he was in hospital were deleted and he had never previously been able to understand why."
She told the judge: "I am here today to announce that, after considering the details of Mr O'Grady's claim, News Group Newspapers Limited accepts that Mr O'Grady's voicemail messages were intercepted and that there has been a misuse of his private information.
"News Group Newspapers Limited accepts that this activity should never have taken place and it has agreed to apologise to Mr O'Grady and undertake not to repeat such actions.
"It has also agreed to pay Mr O'Grady substantial damages for the distress he has suffered as well as to pay Mr O'Grady's legal costs incurred in this matter."
Anthony Hudson QC, for NGN, told the judge: "News Group Newspapers Limited is here today through me to offer its sincere apologies to Mr O'Grady for any distress caused by such interception of his private voicemail messages.
"News Group Newspapers accepts that such activity should never have taken place and has undertaken to the court that this will not happen again."