The settlement with American-born Bonnie Woods, who was a member of the church in the 1970s, was announced at London's High Court.
Woods left the Los Angeles-based church in 1982 and converted to Christianity in 1991 after moving to Britain.
After leaving the church, she and her husband began to operate a helpline and offer advice about Scientology to families and friends of members.
Michael Tugenhadt, a lawyer for Woods, said she publicly criticised the Scientologists and had attended vigils outside its bookshop in Surrey.
``As a result of her activities, in June 1993 the Church produced a leaflet showing a photograph of Mrs Woods above the words 'Hate Campaigner Comes to Town','
``Bonnie Woods does not hate any religion and would not take any step to force people away from their chosen religion or encourage others to do so.''
The Scientologists' lawyer, Patrick Moloney, said the church regretted going so far.
Scientology, which boasts a string of star-studded members like Hollywood couple Tom Cruise and Nicole Kidman, is no stranger to controversy.
It is recognised as a religion in the United States but not in Britain or many of its European neighbours. Scientology was founded on the teachings of the late American science fiction writer L. Ron Hubbard.