The Mail on Sunday has apologised and paid substantial damages to one of London's most senior police officers.
Brian Paddick said public figures had a right to a private life
The paper published private information about Brian Paddick, the Metropolitan Police's Acting Deputy Assistant Commissioner, given by his ex-partner.
It also published drug-taking claims which it has now accepted were false.
Mr Paddick, the UK's highest-ranking openly gay officer, welcomed the out-of-court deal, saying: "There has to be a limit to press intrusion."
Mr Paddick, formerly commander of the Lambeth division in south London, pioneered the controversial "softy, softly" approach to cannabis, where he instructed his officers not to arrest people over small amounts of cannabis.
But he was moved from the £93,000-a-year post in March last year, after an ex-boyfriend made various claims in the Mail on Sunday, including that he smoked cannabis and allowed the drug to be used at his home - an allegation which he denied.
He took legal action over breach of confidence, and Friday's deal was agreed ahead of the court hearing which was scheduled for February.
"I am relieved that the Mail on Sunday have at last seen sense and agreed to apologise," he said in a statement on Friday.
"They now accept that much of the information they printed about my private life should never have been published and that the main allegation against me was false.
"Whilst the press have a right to publish information that is genuinely in the public interest, I have been concerned by the increasing number of articles that unjustifiably include confidential information about people's private lives.
"There has to be a limit to press intrusion and this case helps to draw that line."
His solicitor, Tamsin Allen of Bindman and Partners, added:
"This was a real privacy case. Mr Paddick is a senior public servant who is entitled to a private life.
"It is highly significant that the Mail on Sunday was not prepared to defend its decision to publish intimate details of his relationship with a previous partner. Their decision represents another nail in the coffin of chequebook journalism."
The Crown Prosecution Service investigated the drug-taking allegations, but in October 2002 it announced there was insufficient evidence to prosecute Mr Paddick.
Mr Paddick was appointed to his current position in November of this year, and began the job this month.