Kate and Gerry McCann told Britain's media ethics inquiry that the coverage had hurt their efforts to find their daughter after she vanished during a family vacation in Portugal, shortly before her fourth birthday.
"We were trying to find our daughter and you [the media] are stopping our chances of doing that," Kate McCann said.
"These were desperate times," she said, adding that the couple felt powerless.
"When it's your voice against a powerful media, it just doesn't hold weight."
Madeleine's mysterious disappearance sparked an international manhunt and intense press coverage. The McCanns said the press was initially sympathetic but that soon changed, with some articles implying that the couple were hiding something. The couple successfully sued several British newspapers over suggestions they had caused their daughter's death.
UK Prime Minister David Cameron set up the public inquiry into media ethics and practices in response to a still-evolving scandal over phone hacking by tabloid journalists. This week it has taken evidence from celebrities, including actor Hugh Grant and comedian Steve Coogan, and ordinary people left bruised by unwanted media attention.
Gerry McCann said he and his wife did not think their phones had been hacked, but he volunteered to testify at the inquiry "for one simple reason - we feel a system has to be put in place to protect ordinary people from the damage the media can cause."
It is still not clear what happened to Madeleine, despite her parents' international campaign and numerous reports of sightings around the world.
Earlier, a lawyer for several phone-hacking victims said that illegal eavesdropping was widely practised by tabloid journalists, producing stories that were both intrusive and untrue.
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