Former News of the World editor Andy Coulson has been released from police custody after being arrested over allegations of phone hacking and payments to officers.
The former Downing Street communications chief left Lewisham police station in southeast London amid a media scrum, saying: 'There is an awful lot I would like to say, but I can't at this time.'
He was released on police bail until October.
Minutes later, former News of the World royal editor Clive Goodman was also released on bail after being arrested earlier in the day.
A Scotland Yard spokesman said: 'Two men arrested by officers from Operation Weeting together with officers from Operation Elveden this morning have been bailed.
'A 43-year-old man arrested on suspicion of conspiring to intercept communications and corruption allegations has been bailed to return to a London police station in October.
'A 53-year-old man arrested in connection with corruption allegations has been bailed to return to a London police station in October.'
Meanwhile, an unidentified 63-year-old has become the third man to be arrested by police investigating phone hacking.
The corruption allegations relate to claims that the News of the World paid police officers for information when Mr Coulson was in charge of the paper from 2003 to 2007.
Plain-clothed officers carrying evidence bags searched Mr Coulson's home today.
Operation Weeting is the police investigation into phone hacking and Operation Elveden is the police investigation into allegations of inappropriate payments to police.
The arrests come after yesterday's surprise announcement that the News of the World would to close the Sunday following the latest allegations of phone hacking.
It is alleged private investigators hired by the paper hacked into phones belonging to the families of a number of high-profile murder victims, the relatives of dead British soldiers and the families of victims of the 2005 bomb attacks in London.
Over 4,000 people may have had their phones illegally hacked into by the News of the World.
Mr Coulson resigned as editor of the paper in 2007 after one of its journalists and a private investigator were jailed over illegally accessing the voicemail of mobile phones.
He had always denied any knowledge of phone-hacking and went on to become David Cameron's media chief in the run-up to last year's British general election, a key role that helped the Conservative leader become prime minister.
Today, Mr Cameron publically responded to the scandal, promising two inquiries into the News of the World phone hacking.
He said a judge would be appointed to run an independent inquiry into how the scandal was allowed to happen, adding: 'No stone will be left unturned.'
Mr Cameron said a second inquiry would be held to examine the ethics and culture of the press and said that the Press Complaints Commission had failed, adding: 'I believe we need a new system entirely.'
However he said the bulk of the first inquiry, which will also cover other newspapers and the failure of the first hacking investigation, could not be carried out until after the new police investigation was complete - a process that could take months or even years.
Accepting some of the blame, Mr Cameron said party leaders 'were so keen to win the support of newspapers we turned a blind eye to the need to sort this issue'.
Commenting on Rupert Murdoch's efforts to take full control of BSkyB, Mr Cameron said his government had to follow proper legal procedures and the decision would take 'some time'.
Gallery: Scenes from Fleet Street
Staff shocked by closure
News International announced yesterday evening that publication of the 168-year-old tabloid was ending and this Sunday's edition would be the last.
News International Chairman James Murdoch said the company acknowledged mistakes had been made and it was determined to address them.
Mr Murdoch, the son of media mogul Rupert Murdoch, pulled the plug on the paper after claims that it paid private investigators to illegally intercept the voicemail messages of murdered schoolgirl Milly Dowler, bereaved military families and relatives of the London bombing victims.
News of the World journalists reacted with shock and sadness and there were tears in the newsroom when News International Chief Executive Rebekah Brooks, the editor when hacking occurred, broke the news to staff. Ms Brooks has kept her job.
Current editor Colin Myler said last night: 'This is the saddest day of my professional career. For 168 years the News of the World has been a huge part of many peoples' lives.
'Sundays without this great British institution will not be the same.'
The Royal British Legion had earlier dropped the News of the World as its campaigning partner and expressed 'revulsion' at allegations that war widows' phones may have been hacked.
As the day went on more and more of Britain's biggest companies - among them Sainsbury's, O2 and nPower - said they were pulling their advertising from the title.
This weekend's edition of the News of the World will have no commercial advertisements and all the revenue from sales will go to good causes.
