After days of rumours and speculation, News International chief executive Rebekah Brooks has resigned.
In a letter to staff, Brooks said the furore over phone hacking and criticisms levelled at her decision to remain at the newspaper company were "detracting attention from all our honest endeavours to fix the problems of the past".
At News International we pride ourselves on setting the news agenda for the right reasons. Today we are leading the news for the wrong ones.
Therefore I have given Rupert and James Murdoch my resignation. While it has been a subject of discussion, this time my resignation has been accepted.
Rupert's wisdom, kindness and incisive advice has guided me throughout my career and James is an inspirational leader who has shown me great loyalty and friendship.
I would like to thank them both for their support.
In the letter she said she would still be attending the culture, media and sport select committee hearing next Tuesday.
Politicians and campaigners called for Brooks, 43, to resign after allegations emerged that News of The World hacked into murdered schoolgirl Milly Dowler's phone while she was editor at the Sunday paper.
It has also emerged that Rupert Murdoch, chairman of News Corp, will meet the Dowler family face-to-face in central London on Friday.
Tom Mockridge, who is currently chief executive at Sky Italia, has been named as News International's new chief executive.
James Murdoch praised Brooks in a statement released on Friday, saying:
"She has been one of the outstanding editors of her generation and she can be proud of many accomplishments as an executive"
Brooks' resignation came after the FBI announced an inquiry into allegation that victims of the 9/11 attacks had their phones hacked by reporters at News of The World.
The developments provide the latest twists to the phone hacking scandal, which in the last week has seen The News of The World publish its last edition, News Corp pull out of its £8.7bn bid for BSkyB, the government launch a judge-led inquiry into the claims and numerous arrests of former newspaper executives.