David Letterman admitted on "Late Night with David Letterman" on Thursday that he "had sex with women who work on this show." He also told his stunned audience that he had testified before a grand jury that afternoon about being blackmailed by a CBS employee who threatened to go public with the affairs unless Letterman gave him $2 million.

Letterman did not say how many employees he'd had relationships with nor give a time frame of the affairs. In March, Letterman married Regina Lasko, his girlfriend of 23 years and the mother of his 5-year-old son.

CBS producer Robert "Joe" Halderman was arrested Thursday on a charge of attempted grand larceny. Halderman, 51, is an Emmy Award-winning CBS producer. According to the New York City Department of Corrections Web site, Halderman was booked into the Manhattan Detention Center.

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PD toolbar!Various sources are reporting that the woman in the center of the incident is Stephanie Birkitt. According to the Web site TMZ, Letterman had a relationship with Birkitt that ended before 2003. Birkitt then went on to date Halderman. The couple reportedly broke up recently, but Halderman allegedly took Birkitt's diary, correspondence and photos, which are the incriminating information in the packet Letterman found in his car.

Letterman's confession on the show last night was both dramatic and strange, as the audience clearly thought he was joking at times, confusing his public admission with dry humor.

After his monologue and a commercial break, Letterman spoke to the audience from his desk on the CBS set. He started by saying that three weeks ago he found a package in the back of his car. He explained that inside the package was a letter that said "'I know that you do some terrible, terrible things, and I can prove that you do these terrible things.'"

Letterman went on to say that "sure enough, contained in the package was stuff to prove I do terrible things." The audience laughed in response, and Letterman continued.

"I study it, and it's a guy who's going to write a screenplay about me. Now that's good news for everyone, isn't it really?" Again, the audience applauds and laughs. He goes to say "how terrifying this moment" was of finding the extortion letter in his car.

Letterman then says "I'm motivated by nothing but guilt. If you know anything about me. I am just a towering mass of Lutheran Midwestern guilt." In response, the audience applauds, and he says "Oh, thank you."

He then tells the audience that he then called his attorney. The two then set up a meeting with "the guy." Letterman says that the man says in the meeting that he wants "a large sum of money or he's going to produce this screenplay of all the terrible things I do."

Letterman then looks up, directly into the camera, and says, "Embarrassing, terrible things." He goes on that "at that point my attorney and I say, 'Wow, this really is icky,' " while covering his mouth with his fingers.

His attorney then calls the Manhattan District Attorney's Office. He said that they "took stuff down there, and they said, 'Well, hello, this is blackmail,' " to which the audience responds with applause.

Describing how they then set up a sting operation, Letterman says they asked the man for a second meeting. In that meeting, they ask the man directly if he knows what he's doing could be considered a criminal act, "which he says he does," and tells them that he will be writing "a book along with the screenplay."

Letterman summarizes this meeting: "This guy knows creepy stuff about me." So, at the end of the second meeting, they reassured the man that everything was "just fine and then a third meeting is arranged" when the man is given a check for $2 million.

"The check is turned over," Letterman says. "So now this guy is walking around New York City with a phony check for $2 million."

Moving onto the grand jury testimony Thursday, he says, "So this morning I did something I have never done in my life, and it was a combination of just unusual and scary. This whole thing has been quite scary. I had to go downtown to testify before the grand jury. And I had to tell them how I was disturbed by this, I was worried for myself, I was worried for my family, I felt menaced by this."

He says that he "had to tell them all of the creepy things that I had done that were going to be..." At this point, Letterman is interrupted by audience laughter. He goes on to say that the grand jury issued a warrant after his testimony and Thursday afternoon "the guy was arrested."

Addressing the sexual relationships with his employees, Letterman says: "And the creepy stuff was I have had sex with women who work for me on this show." The audience audibly gasps now.

"My response to that is 'Yes, I have.'" The audience then laughs and applauds, he continues, "I have had sex with women who work on this show. And would it be embarrassing if it were made public? Perhaps it would." He then makes a joke, saying, "Especially for the women," to which the audience responds with laughter and applause.

"But that's a decision for them to make -- if they want to come public and talk about the relationship. If I want to go public and talk about the relationships. But what you don't want is a guy saying," and Letterman imitates the man with a whiny tone of voice "'I know you had sex with women so I would like $2 million or I will make trouble for you.'"

He wraps up the confession with a seeming request for public support for both his side of the legal case as well as his enormously popular show. "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. Hope to protect my job."

Just when Letterman seems to have ended the public confession, he launches into making light of the topic. "I know what you're saying," he says using an imitation of a southern accent, "'I'll be darned, Dave's had sex.' That's what the grand jury said also. 'Really? You've had sex?' " The audience roars.

There are no reports of sexual harassment complaints against Letterman. CBS has said that Letterman's public admission would stand on its own. There are also no reports on his wife's reaction to his confession.

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