Hugh Grant has accepted a "substantial sum" from Rupert Murdoch's British tabloid publisher over phone hacking by the News of the World, the British actor's lawyer said on Friday.

The "Four Weddings and a Funeral" star will donate the damages to the Hacked Off campaign against press intrusion, solicitor Mark Thomson said.

"Hugh Grant has today settled his claims for damages and other legal remedies arising out of the unlawful activities of News of the World journalists and others over a number of years," Thomson said in a statement.

"News Group Newspapers (NGN) have agreed to pay him 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."

Thomson said the damages would be transferred to Hacked Off as soon Grant, 52, receives the payment.

"A statement in open court will be made shortly in the new year," the lawyer added.

Grant, one of the most high-profile celebrity victims of phone-hacking by the News of the World, has become a vocal campaigner for press reforms since media baron Murdoch was forced to close down the 168-year-old tabloid over the scandal in 2011.

Revelations that the newspaper's staff accessed the voicemail messages of a murdered schoolgirl, as well as dozens of celebrities, politicians and sport stars, had prompted a wave of public disgust.

The scandal sparked a judicial inquiry into press ethics and three police investigations.

NGN has since paid compensation to dozens of people, including actors Jude Law and Sienna Miller, footballer Ashley Cole and former deputy prime minister John Prescott.