Privacy campaigners have been angered by the system despite it getting the all-clear from the Information Commissioner's Office (ICO).
The ICO ruled that the system did comply with current law and was little different from companies who use such contact lists for cold calling.
It said that opting out of the service should be made easy for those not wanting their details to be used in the directory.
Shona Foster says her company is acting ethically.
118800 gets numbers from three sources. First, market research companies who contact individuals and ask if they would be prepared to allow their numbers to be used for commercial purposes.
Second, from online businesses who often ask customers to tick boxes during the normal course of online transactions.
Thirdly, 118800 gets them from brokers who buy and sell lists of phone numbers.
118800 said that has about 15m phone numbers on its databases which is just a fraction of the 40m adults who have one or more handsets in the UK.
Some legal observers are concerned by the precedent the system sets.
"You are supposed to have people's consent if you are going to pass their number around and they need to know where it is going to go," says Chris Watson, a lawyer at CMS Cameron McKenna.
"When people tick a box, saying they have no objection to their number going to the company they are dealing with, they don't anticipate that it could then be sold.
"Not just possibly to trading partners, but to anybody under the sun".
Connectivity - the company operating the 118800 service - said that privacy is paramount to them, and that it's easy to withdraw your mobile phone number from their databases should you choose to do so.
To unsubscribe, you can either click on the ex directory button on the their web homepage, or you can text the letter 'E' to 118800 from the mobile phone you want to be made ex-directory. 118800 will send you an SMS message confirming you've been taken off.