Rebekah Brooks told of a "climate of paranoia" at News International in the final throes of the News of the World.
Brooks accused police of repeatedly leaking information to the Guardian at the height of the hacking crisis in 2011, the Old Bailey heard.
Speaking on her 13th day in the witness box, she said: "All we knew at NI from the beginning of (operation) Weeting pretty much the main things being discussed internally, the main actions, were being leaked. There was a climate of paranoia."
But prosecutor Andrew Edis QC pointed out that the solicitor for Milly Dowler's parents was quoted in one story, and police had nothing to do with internal announcements to NI staff.
Brooks described suffering sleepless nights in her last days as chief executive when she devised a "Plan B" memo, which involved her staying on and finding jobs for NoW staff after the Sunday paper closed.
On her own position, she said she had offered to resign but Rupert Murdoch had refused to accept it.
But ever since April when she was told by a colleague she faced arrest, she said: "It was a pretty grim picture. I don't think I had a particularly great future from then."
Brooks was encouraged to take a leave of absence and her husband Charlie Brooks even "confiscated" her BlackBerry mobile phone, the Old Bailey heard.
She got it back the next day "because I saw where he hid it", she said.
Brooks, 45, of Churchill Oxfordshire, denies conspiracy to hack phones; conspiracy to commit misconduct in public office; and conspiracy to pervert the course of justice.