Treasurer Joe Hockey is expected to be heavily out of pocket after Fairfax was ordered to pay only 15 per cent of his legal bill in his defamation claim against them.
However, in a statement he said he does not regret taking legal action.
"After nearly twenty years in public life I took this action to stand up to malicious people intent on vilifying Australians who choose to serve in public office to make their country a better place.
"The Federal Court has found that the Sydney Morning Herald and The Age defamed me" and "that Fairfax Media acted with malice through the actions of their Editor-in-Chief, Darren Goodsir," he said.
"This is an unprecedented finding by a court against an Editor-in-Chief of a major Australian newspaper," he added.
Mr Hockey was awarded $200,000 last month after the Federal Court found Fairfax defamed him when it splashed the words "Treasurer for Sale" across a Sydney Morning Herald promotional poster and broadcast two similarly worded tweets from The Age.
But the court dismissed the rest of Mr Hockey's claims that the articles defamed him.
On Wednesday, Justice Richard White ordered that Fairfax pay only 15 per cent of his legal costs in relation to his claims against The Age and the Sydney Morning Herald.
Fairfax reports the combined legal bill is more than $1 million. However The Guardian reports that each side is estimated to have spent about $1 million in the battle. If that's true, it means that the treasurer could be left about $650,000 out of pocket by the defamation action, while the case would have cost Fairfax around $1.35 million.
The order falls well below the 95 per cent the Treasurer was asking and is expected to leave Mr Hockey in the red, having been represented throughout the trial by top silk Bruce McClintock SC.
Mr McClintock's other clients include Australia's richest person Gina Rinehart.
Mr McClintock had argued during the Federal Court costs hearing earlier this month that Fairfax should foot at least 95 per cent of their costs as Mr Hockey had ultimately been awarded a substantial sum.
But Fairfax's barrister Sandy Dawson said the case "was an unmitigated disaster for Mr Hockey and a costs order should reflect that".
He argued the treasurer should instead be covering 60 per cent of the publisher's legal costs.
Justice White said Mr Hockey - who had taken the Age, the Sydney Morning Herald and The Canberra Times to court - had failed altogether in his claim against the ACT paper.
It was plain, he found, that Mr Hockey was also not entitled to his costs in the matters against The Age and the SMH to be paid in full, as "he failed on the matters which were the real core of his claim."
Had he just sued the publisher over the poster and the two tweets, the matter may not have gone to trial at all, Justice White said.
He also dismissed the politician's claims that Fairfax had been unreasonable in not settling the matter before it went to trial.
"It cannot be said to have been unreasonable for the SMH and The Age to refuse to agree to a settlement requiring them to pay damages significantly in excess of the liability found against them," Justice White added.
Mr Hockey was awarded damages of $120,000 for the poster and $80,000 for two similarly worded tweets but his claim over the content of the articles was dismissed.
The articles said Mr Hockey gave access to a select group in return for donations to the Liberal Party via the North Sydney Forum, a fundraising organisation whose activities were not fully disclosed to election funding authorities.
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