The panel's report said Murdoch did not take steps to become fully informed about the hacking.
Parliament's Culture, Media and Sport committee began an inquiry amid disclosures about widespread tabloid hacking of voicemail, concerns over bribes paid to police for scoops, and politicians who may have overstepped the bounds by cozying up to key players in the Murdoch empire.
The committee's scathing words on the Murdochs could affect their controlling stake in British Sky Broadcasting.
The panel also accused Murdoch of willingly ignoring what was going on in his companies and publications, in addition to actively covering up some of the wrongdoings.
In a memo to his employees on Tuesday, Murdoch acknowledged mistakes were made.
"We certainly should have acted more quickly and aggressively to uncover wrongdoing," he wrote. "There is no easy way around this, but I am proud to say that we have been working hard to put things right."
The Associated Press contributed to this report.