The Leveson Inquiry is hearing from a former tabloid journalist who says he resigned over "anti-Muslim hate-mongering".
At a seminar before the inquiry began, Richard Peppiatt claimed tabloid stories were often pre-planned, with reporters expected to get facts to fit.
Lord Justice Leveson is examining the media's culture, practices and ethics.
Guardian journalist Nick Davies and ex-News of the World journalist Paul McMullan will give evidence later.
Mr Davies wrote an article in July 2009 revealing claims of widespread phone hacking at News Group Newspapers.
Mr McMullan was deputy features editor at the News of the World between 1994 and 2001 and has spoken about the use of phone hacking on the paper.
'Make up quotes'
Mr Peppiatt resigned from the Daily Star in March after working at the paper on a casual basis. He said he regularly made up quotes and sometimes entire stories for the newspaper and was stepping down in protest at what he said was "anti-Muslim hate-mongering".
The newspaper said Mr Peppiatt had been warned not to make up quotes and denied it had any negativity towards Islam. It said Mr Peppiatt had been "unhappy after he was passed over for several staff positions".
At a Leveson Inquiry seminar in October, Mr Peppiatt said tabloid newsrooms were "bullying and aggressive environments in which dissent is often not tolerated". "The question is not, 'do you have a story on X?', the question is 'today we are saying this about X, make it appear so'," he said.
Lord Justice Leveson's inquiry is looking at the "culture, practices and ethics of the media" and whether the self-regulation of the press works.
Prime Minister David Cameron established the inquiry in July 2011 after it was revealed that the voicemail of murdered schoolgirl Milly Dowler was hacked while she was missing.
A second phase of the inquiry will commence after the conclusion of a police investigation into NoW phone hacking and any resultant prosecutions. It will examine the extent of unlawful conduct by the press and look at the police's initial hacking investigation.