Two former editors of the newspaper - Murdoch's protegee Rebekah Brooks and Andy Coulson, a one-time media chief to Prime Minister David Cameron - are among eight defendants at the high-profile trial.
It is the first time that criminal charges have been put to alleged key players in the scandal that rocked the British media and the political world two years ago.
Brooks, Coulson and the six others are accused of offences ranging from plotting to illegally hack celebrities' phones to concealing evidence and bribing officials for stories.
All the defendants deny the charges against them.
Opening the case at London's Old Bailey court, prosecutor Andrew Edis said the jury had "quite a simple" question to consider.
"There was phone hacking," he told the panel of nine women and three men. "Who knew?"
Three former senior journalists at the News of the World - Greg Miskiw, James Weatherup and Neville Thurlbeck - have pleaded guilty to conspiracy to hack phones, Edis revealed.
Murdoch shut down the 168-year-old News of the World in disgrace in July 2011 amid a storm of allegations that its staff had hacked the mobile phone voicemail messages of a murdered schoolgirl as well as hundreds of celebrities and public figures.
Brooks and Coulson, both 45, are the most high-profile defendants in a trial that is set to last up to six months.
The prosecution stressed that the case was about more than just phone hacking. Edie said Brooks was accused of paying STG40,000 ($A68,000) to a Ministry of Defence official for information.Do you have any story leads, photos or videos?