Colin Craig and a former Conservative Party board member have reached an out-of-court settlement which includes a confidential financial payment.
The former Conservative Party leader alleged John Stringer defamed him in 2015 in what was described as a "relentless succession of publications in various media".
The case was set down for a three-week hearing in a judge-alone trial in March, but witnesses have been told they are no longer needed to give evidence.
Craig declined to comment.
"I'll give you a ring once the court document has been issued. Once I've got that in hand, I'll be happy to comment."
In a statement just after midnight, Craig said he would be celebrating with his family today.
"Obviously I am very happy to have concluded one of the legal battles with a clear and final result.
"There was never any doubt that I would be successful, but it does feel good to have reached that point."
Craig, who represented himself in the case, said he would be writing to media organisations to request that publications containing defamatory allegations at the time be taken down.
Stringer confirmed the defamation case against him had been settled, with a confidential financial payment, by consent yesterday.
"I'm very happy with the outcome."
However, Stringer added his counter-defamation claim against Craig was still going ahead.
He said this is scheduled for June, shortly after another defamation trial between Craig and Whale Oil blogger Cameron Slater.
News of the settlement with Stringer comes five months after Craig lost a defamation case against Taxpayers Union executive director Jordan Williams.
In that case, the defamation claim against Craig was upheld by a jury and Craig was ordered to pay a record-setting $1.27 million in damages to Williams. He has said he will appeal.
The case focused on Craig's relationship with his former press secretary Rachel MacGregor.
During the trial which ended in September, Williams told the court he went to Conservative Party officials in 2015 after MacGregor, who quit suddenly two days before the 2014 election, confided in him about allegedly being sexually harassed by Craig, including touching, comments, and romantic letters and poems.
Craig resigned in June 2015 and said Williams was part of a plot to oust him as leader, accused him of spreading lies and leaking to bloggers and also threatened to sue Williams.
He sent the 12-page pamphlet Dirty Politics and Hidden Agendas to 1.6 million homes to try to defend his reputation, his lawyers said.
It took the jurors nearly 10 hours of deliberation to reach their verdict in the case, which had 1000 pages of transcripts.
The 11 jurors, one was discharged early, had to decide whether Williams' reputation had been harmed, whether Craig had told the truth, held an honest opinion, or if he was just defending himself in a reasonable way.
During the trial, MacGregor told the court she quit after Craig told her he had "slept well the night before because he had imagined he was lying on my legs".
She called him "dodgy" among a string of other insults, saying he harassed her over a long period of time and refused to pay her for months.
Poems and letters allegedly written by Craig to MacGregor were read to the court by Williams, containing lines such as saying she looked "unbelievably good in your new dress" and her lips were "amazing to kiss".
In his evidence, Craig said his relationship was inappropriate but consensual and she had changed her story.
Colin Craig's legal labyrinth
September 2016: Ordered to pay $1.27 million after Jordan Williams successfully sued him for defamation.
January 2017: Reached an out-of-court settlement with John Stringer, whom Craig alleged had defamed him.
May 2017: Defamation trial scheduled between Craig and Cameron Slater. Craig sued the Whale Oil blogger, who in turn laid his own defamation counter-claim.
June 2017: Despite settling Craig's defamation claim against him, Stringer plans to carry on with his counter-claim against Craig.