The "story" reported Murdoch had "ingested a large quantity of palladium" and died in his garden.
LulzSec quickly took credit for the hack, claiming on Twitter "We have owned Sun/News of the World - that story is simply phase 1 - expect the lulz to flow in coming days".
The site was quickly fixed, but appears to now have been targeted again.
The website was redirecting to the LulzSec Twitter account.
Early this afternoon it appears many of the websites belonging to News Corp. publications, including the Sun and The Times were not accessible.
It's been a bad day for News Corp.
Earlier Standard & Poor's warned News Corp that its credit rating could be cut as the snowballing British phone hacking scandal threatened to claim more victims.
S&P placed News Corp's BBB+ rating on a negative watch - a prelude to a potentially costly downgrade - citing "increased business and reputation risks" from investigations into the widening phone hacking scandal in Britain.
- Herald online staff with AFP