UPDATE 2-UK PM's former media chief tells court he heard hacked messages
* Ex-Murdoch editor Coulson admits listening to hacked call
* Voicemails left by senior British minister
* Coulson later worked for PM Cameron
* Says "do his phone" email nothing to do with hacking (Writes through with new quotes, evidence)
LONDON, April 16 (Reuters) - Andy Coulson, the former media chief to British Prime Minister David Cameron, told a London court on Wednesday he had listened to a recording of hacked voicemail messages left by the then interior minister in 2004.
Coulson, who was editing Rupert Murdoch's now defunct News of the World tabloid at the time, is on trial for conspiring to hack into voicemail messages in a case that has shaken the media tycoon's empire and Britain's political elite.
Coulson has denied the charge, but admitted for the first time on Wednesday that one of his senior reporters had once played him excerpts of voicemail messages left by then Home Secretary David Blunkett on the mobile phone of a woman with whom he was having a relationship.
"This was the first and only time voicemail messages were played to me," Coulson told the packed Old Bailey court where he was appearing in the witness box for the third day in a trial that has run for 5-1/2 months.
Coulson, Cameron's communications chief from 2007-2011, said he had been on holiday in Italy in July 2004 when the paper's then chief reporter Neville Thurlbeck told him about the recordings.
"I was very angry about it. I used some colourful language and asked what on earth do you think you are doing?" he said. "I told Neville ... to stop whatever it is you are doing."
The jury has heard Thurlbeck was one of four former News of the World journalists who have pleaded guilty to conspiring to illegally tap into voicemail messages since police re-launched an investigation in January 2011.
The issue of phone-hacking first came to light in 2007 when the News of the World's royal editor Clive Goodman and a private investigator Glenn Mulcaire were convicted of the offence.
Coulson, who was the editor at the time, quit the paper but Murdoch's British newspaper arm maintained that Goodman had been a lone "rogue" reporter.
It was only in 2011 that it emerged the practice was more widespread, prompting a new police investigation which led to a scandal, Murdoch's closure of the 168-year-old tabloid and Cameron to order a public inquiry into press ethics.
The court heard that when Coulson returned to work after his holiday, Thurlbeck came to see him to argue for his story about Blunkett, saying it was in the public interest because the minister had been discussing terrorism arrests and a visit to Britain's spying agency GCHQ on the voice messages.
Asked by his lawyer Timothy Langdale where he thought the recordings had come from, Coulson said he had not discussed it.
"It was all coming from Neville. My assumption was that Neville Thurlbeck had obtained these voicemail messages himself," he said.
Coulson said he eventually decided there was a public interest justification in pursuing the Blunkett story. He told the court he had not known phone-hacking was a crime until Goodman's arrest, and that he had also consulted an executive and company lawyer.
"There was no mention made of illegality," Coulson said of the legal advice he received, adding there was only concern about possible breach of privacy.
The court has heard that recordings of the voicemails and a draft story were found in the safe of the lawyer at News International, Murdoch's British newspaper arm.
Coulson, in a meeting with Blunkett, confronted him about the love affair but made no reference to the hacked voicemails. He said in hindsight he wished he had handled the story differently and been "completely up front" with Blunkett.
"It would have brought the whole thing to a head and at least I would have been able to argue my case," he said.
"I didn't know it was illegal and I felt I was justified. It might have ended in legal action, it might have ended in police action. I sincerely wish I had followed that course of action."
In later evidence, Coulson said a May 2006 email in which, referring to a colleague suspected of leaking stories to rival papers, he told a senior News of the World employee to "do his phone" was nothing to do with phone-hacking. He said he had reluctantly decided to authorise a check on the billing data of the suspected journalist, and that is what the phrase had meant.
"I was in no doubt that this was not an instruction to anybody to hack anyone's telephone," he said, but told the court no evidence of any checks was ever put in front of him.
Shortly after quitting the paper, Coulson went on to work for Conservative Party leader Cameron, first in opposition and then in Downing Street after the May 2010 election. He was forced to quit the high-profile role eight months later when the phone-hacking scandal re-emerged.
The trial of Coulson, who also faces charges of authorising illegal payments to public officials, and six others continues. (Additional reporting by Kate Holton; editing by Stephen Addison and Janet Lawrence)