Sir Elton John has accepted £100,000 libel damages over claims about his behaviour at his annual charity ball.
Sir Elton said the story damaged the image of his charity work
The Daily Mail falsely alleged he issued a "bizarre and absurd edict" to guests not to approach him, Sir Elton's lawyer Nigel Tait told the High Court.
Sir Elton's spokesman said he was "happy with the settlement", to be donated to the singer's Aids charity.
In February Sir Elton accepted undisclosed damages from the Sunday Times, which reprinted the story.
The Daily Mail story appeared on 24 June 2005.
Mr Tait said it presented the star as "acting like old-fashioned royalty or some tinpot dictator and exhibiting self-important, arrogant and rude behaviour bordering on paranoia".
No such edict was issued and Sir Elton greets each guest as they arrive, he told the court.
"[He] is well-known for chatting to as many people as possible who attend the ball, not least to thank them for helping him with his fund-raising efforts."
The paper later published an apology and "has at no stage in these proceedings sought to justify the allegations", Mr Tait added.
The damages will go to the Elton John Aids Foundation, which has raised about £50m since it was established in 1992.
The original story concerned the annual White Tie and Tiara Ball fund-raiser, hosted by the chart-topping star and attended by a number of celebrities.
The songwriter felt the story had affected the image and reputation of his fund-raising efforts.