Hewitt opened a golf driving range in 1994. He opened the Polo House, a bar in the fashionable Golden Mile of Marbella, Spain, in 2009. It closed in 2013. In 2006, Hewitt appeared as a contestant in , the celebrity version of The X Factor. He also appeared in the first episode of the UKTop Gearin Series 8 in May of the same year to participate with other celebrities in setting power lap times around the Top Gear Test Track in the show's newest "reasonably priced car": when the presenters seemingly did not recognise him upon his arrival, they were apparently too embarrassed to admit as much, and rather than ask him his name, they listed his lap time as "Well Spoken Man".
In 1994, six months after Hewitt's retirement from the armed forces, Anna Pasternak published the book Princess in Love. Hewitt was a major source, and it alleged that he had a five-year affair with Diana, Princess of Wales from 1986 to 1991. Diana confirmed the affair in her 1995 Panorama interview. The following year, the film Princess in Love by David Greene was released, based on the book, with Julie Cox and Christopher Villiers playing the lead roles. Hewitt considered suicide after the affair ended. He was preparing for a trip to France, and he wanted to shoot himself. He said, "I got in my car and loaded a few things up to get on the ferry to go to France – to shoot myself.... And then my mother insisted on coming with me. And, if she hadn't, I would have probably shot myself. So I owe her my life really". In 2003, Hewitt tried to sell his 64 personal letters from Diana for £10 million. The act of selling the letters was considered to be a betrayal of trust, and Sarah, Duchess of York, condemned his action. She was reported to have said, "Betrayal, I think, is the most horrible, horrible, disloyal thing you can do to anyone". Persistent suggestions have been made in the media that Hewitt, and not Charles, is the biological father of Diana's second son, Prince Harry, Duke of Sussex. Hewitt stated to the press in 2002 that Harry had already been born by the time of the affair, a statement also made by Diana's police bodyguard. He reiterated this in an interview in 2017. Diana attributed Harry's colouration to her side of the family, calling him her "little Spencer".
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In July 2004, Hewitt was arrested outside a restaurant in Fulham with Alison Bell, a CNN journalist, for the possession of cocaine. A drunken Hewitt had of cocaine in his pocket. He was given a warning, and Bell was released without charge. As a result, he was refused reinstatement of his firearms licences because of his "intemperate habits" after police found a disassembled 16-bore shotgun on his living room floor. On 14 May 2017, it was reported that Hewitt had suffered from both a heart attack and stroke, leaving him fighting for his life in hospital. However, by the end of June 2017, Hewitt had been released from hospital and was said to be recovering well at home.