Letterman admits to sleeping with female staff.

US chat show host David Letterman has made a startling on-air confession of having had sex with female staff and claimed he was the victim of a blackmail plot.

He told the studio audience of the CBS Late Show on Thursday that he found a package in his car three weeks ago from a person claiming to have information about his sexual affairs.

The blackmailer is said to have demanded $2m (£1.25m) to avoid going public.

He quoted a note as saying: "I know that you do some terrible, terrible things and I can prove that you do these terrible things."

"Sure enough, contained in the package was stuff to prove that I do terrible things," Letterman added.

"The creepy stuff was that I have had sex with women who work for me on this show," Letterman told the stunned audience, which seemed unsure how to react to the story, laughing and applauding at times and exclaiming at others.

"This morning, I did something I've never done in my life," Letterman revealed.

"I had to go downtown and testify before a grand jury."

Letterman did not identify the alleged blackmailer, however CBS later released a statement revealing it was a fellow employee working on the network's 48 Hours - a true crimes documentary show.

The person was arrested on Thursday on charges of attempted grand larceny in the first degree and has been suspended by CBS pending the investigation.

Twice-married Letterman helped set up a sting operation with the Manhattan District Attorney's special prosecution bureau and before giving the alleged extortionist a fake $2m cheque.

During his testimony to the New York City jury Letterman admitted to several affairs.

A former TV weatherman, Letterman has had a 27-year career in late-night comedy and hosted the Late Show for 16 years, totaling more than 5,000 late night broadcasts.

His show is a magnet for actors, musicians and celebrities on the promotion trail and guests in the last week included President Barack Obama, and Madonna - who was quizzed by him about her marriage.

CBS spokesman Chris Ender later said: "Letterman's comments on the broadcast tonight speak for themselves."

Intensely private and rarely photographed with his family, Letterman, 62, married his longtime girlfriend Regina Lasko, 48, last March in Montana and they have a son, Harry, born in 2003.

Letterman added: "It's been a very bizarre experience. I feel like I need to protect these people - I need to certainly protect my family.

"I need to protect myself. I hope to protect my job."

It was awkwardly funny...I'm not sure how he did it...but he somehow pulled it off and he doesn't really even look that bad right now.

I saw this on the news this morning lmao.

It made me laugh how he was admitting to doing this and the audience was just laughing at him all the while.

Wow, some girls have no standards.

A lot of girls bang thier older boss, this just happens to be famous old boss.