Rebekah Brooks was "relieved" when her husband revealed she was being asked to resign as News International chief executive over the phone hacking scandal, a court has heard.
Charles Brooks said he broke the news to his wife that she was being asked to step down after he had been contacted by the company's then chairman James Murdoch.
Giving evidence in his defence at the Old Bailey, Brooks told the jury he received a phone call from Mr Murdoch, the son of media mogul Rupert, who said he felt Rebekah should quit.
"James Murdoch now felt Rebekah should resign and not take a leave of absence," he said.
Brooks then phoned his wife to break the news, the jury heard, before she left her post on July 15, 2011.
"It was quite an ironic call really because Rebekah said 'Thank God for that'," Brooks said.
"I think Rebekah was relieved. She had been telling them that all along."
Earlier, racehorse trainer Brooks said the couple were "appalled and disgusted" by revelations that murdered schoolgirl Milly Dowler's phone had been hacked.
He told the court that Mrs Brooks had suffered with "paranoia" about being arrested in a dawn raid and she was desperate to avoid the "killer photograph" of her being led away in handcuffs.
She once woke her husband up fearing they were being raided by police but in fact she had heard bin men in the street, the court heard.
The couple held a meeting with then-News International chairman James Murdoch in July 2011 to discuss a Guardian newspaper story alleging Milly Dowler's voicemail messages had been deleted by the News of the World, which was later found to untrue.
Brooks told the court: "The conversation at James Murdoch's house ranged from, 'this is too awful' to being 'this can't have happened'.
"However there was too much accuracy in what had been said for it to be just a political hit. There was too much substance."
Brooks, who told the court that Labour MP Tom Watson "hated" his wife, said they suspected information had been leaked by police.
He added: "It oscillated from being appalled and disgusted...'have we really deleted Milly Dowler's voicemail messages? This is disgusting'...to 'what are we going to do?'"
Brooks told the jury that he and his wife were updated about the police investigation into phone hacking while they were abroad in April 2011.
"The advice was given to Rebekah it was high likely she would be arrested at Heathrow and so change our arrangements," he said.
"Rebekah's big paranoia was the killer photograph."
Asked by his defence lawyer Neil Saunders what the "killer photograph" meant, Brooks replied: "The career-ending photo.
"The photo of you being led from home or Heathrow airport handcuffed by police.
"You're never going to get another job."
Brooks said that Rupert Murdoch had asked that he call him in America if Rebekah showed "any signs she was going to resign".
"He explicitly told me if she shows any signs she was going to resign, I should ring him in America so he could ring her and stop her resigning," he told the jury.
Earlier in the trial, the court heard Brooks had stashed bags containing an assortment of items including a porn magazine, lesbian porn DVDs and two laptops behind bins in the underground car park at their Chelsea Harbour flat just before police searched it while his wife was being interviewed by police on July 17 2011.
He went back to retrieve the bags and discovered they were gone, having been picked up when the bins were emptied, the court has heard.
Brooks, a former amateur jockey, admitted one of the laptops contained "smut" from his time as a "bachelor".
He told the court a number of draft novel ideas were stored on a laptop he had stashed in the car park.
They included a "rip off" of another book called 84 Charing Cross Road which was about a "Hooray Henry" character falling for a Russian prostitute he believed was a "nice, Roedean girl", Brooks said.
Other ideas included a take on the classic Mrs Beeton housekeeping book with explanations of rules in football and cricket, and a "Bill Bryson type idea" about horses, he added.
Brooks was visibly emotional as he told the court that he and Rebekah "bonded" following the death of a mutual friend, journalist Ian Wooldridge, in March 2007.
He told the court that, due to newspaper campaigns his wife worked on, the couple had received "pretty unpleasant mail" following the birth of their daughter and "kidnap threats from paedophiles on the internet".
Brooks had earlier prompted laughter in court as he described a number of previous jobs and business ventures.
They included buying a pub from a friend called "Johnny the Fish", trying to introduce cryotherapy in Britain and writing a "really dreadful" column in the London Evening Standard, he said.
Charles Brooks with his wife, 45, of Churchill, Oxfordshire, and head of security Mark Hanna, 50, of Glynswood Road, Buckingham, Buckinghamshire, deny conspiracy to pervert the course of justice between July 5 and 19 2011.
She also denies conspiring to hack phones and conspiracy to commit misconduct in public office.
All seven defendants in the trial deny the charges against them.
The trial was adjourned until Monday.