Phone-hacking victim Hugh Grant has accepted a "substantial sum" from the News of the World and wil donate the money to the Hacked Off campaign for a free and accountable media.
His solicitor Mark Thomson said: "News Group Newspapers have agreed to pay Hugh Grant a substantial sum by way of damages.
"He has instructed us to donate all of his damages plus an additional payment from him to the Hacked Off campaign for a free and accountable media. This will be done as soon as payment is received.
"A statement in open court will be made shortly in the new year."
The Four Weddings And A Funeral star has been a vociferous critic of press invasions of privacy since the phone-hacking scandal broke last year.
He is a prominent member of Hacked Off, which is now campaigning for the recommendations of the Leveson Inquiry into press practices to be implemented in full.
Grant told the inquiry it had become "extremely fashionable" to hate him in Britain and said journalists were "entitled to their opinion" but hit out at press intrusion and "lazy reporting".
"There has been a section of our press that has become allowed to become toxic over the last 20 or 30 years and its main tactic is by bullying and intimidation and blackmail," he said.
Newspapers are closer than ever to reaching an agreement on the creation of a new watchdog, Press Complaints Commission (PCC) chairman Lord Hunt said yesterday.
Around 100 editors and publishers, including Daily Mail editor Paul Dacre and The Sun's Dominic Mohan, met to examine draft regulations.
But the industry leaders did not discuss proposals floated by Cabinet Office Minister Oliver Letwin for a Royal Charter with responsibility for verifying the new voluntary system of self-regulation because the plan was not yet "on the table".
Culture Secretary Maria Miller is "putting the industry under pressure" to come up with a swift resolution, but no deadline has been made public.
Editors and publishers have until January 3 to raise concerns or comment on the plans.