Phone hacking was an "open secret" on the editorial floor of the News of the World and former editor Andy Coulson knew "exactly what went on on his watch", a jury at the Old Bailey heard.
Dan Evans, the former Sunday Mirror and News International staff journalist who has pleaded guilty to hacking phones during a seven-year period at the Mirror Group and the Murdoch-owned title, said his activities at the News of the World were "completely understood" by his superior.
The court heard that despite daily news conferences at the paper maintaining a pretence that hacking was not used, there was no other concealment. Even the "office cat" knew about the illegal practice, Evans said.
The jury has been told that Evans was hired from the Sunday Mirror by the News of the World because of his phone hacking skills.
Giving evidence for a third day, Evans was questioned by Coulson's lawyer, Timothy Langdale, QC.
The court heard how in 2009, after a self-imposed moratorium on hacking following the arrests of the News of the World's investigator Glenn Mulcaire and former royal correspondent, Clive Goodman, Evans tried to hack into the voicemail of designer Kelly Hoppen. The attempt was spotted, the police were notified and News International faced civil action.
Evans told the jury that his excuse, that "sticky keys" on his mobile had contributed to his dialling Hoppen's number, was "completely untrue".
Questioned by Langdale about his reliability and truthfulness, Evans said that when he was first quizzed by a News International executive about what had happened, he mentioned that his phone was worn out and had sticky keys. He said this detail then appeared in a draft document drawn up for him by News International's lawyers.
Evans told the court: "There was an enormous conspiracy that I was caught up in. I was toeing the company line."
He described himself as "being a very frightened man at the time. I did not know what to do. I'm very sorry for lying at the time."
Earlier, Evans denied lying when he said that his former editor had reacted by saying "brilliant" to a hacked voicemail obtained from the phone of actor Daniel Craig, but said he might have paraphrased the exact term used. The message had been left by actress Sienna Miller, who was having an affair with the Bond star.
Addressing Evans, Langdale said: "You are prone to making sweeping assertions that are not based on fact."
He also said Evans took to "blaming others for things you have done".
Much of Langdale's questioning was devoted to Evans' attempts to secure "full immunity" from prosecution if he co-operated with the phone hacking investigation.
The court heard details of negotiations between Evans' solicitors and prosecutors in 2011 and 2012, in which complete immunity appeared to be his target. He did not succeed.
Evans also said that phone hacking, which he had first started to do at the Sunday Mirror, had led him down a path of alcohol and drug abuse. He told how he had taken an 18-month period of therapy, and revealed that during his time at the News of the World he used cocaine "every couple of weeks".
"I was self-medicating," he told the jury. He said this was because he knew he was doing something illegal, adding, "delving deeply into the lives of people who do not deserve it made me unhappy".
Coulson, with six others, is accused of conspiracy to phone-hack, bribing public officials, and of involvement in a conspiracy to pervert the course of justice. All seven defendants deny all charges. The case continues.