As O'Donnell tells it, she has needed Carpenter's support more than ever during her fight with Gruner + Jahr, a division of Bertelsmann AG. Initially, O'Donnell says, she rejected the idea of her own magazine, until she saw how it had worked for Oprah Winfrey. Then G + J approached her to buy into the flagging McCall's magazine, and turn it into Rosie. O'Donnell says she made it clear from the outset that she planned to come out, quit her TV show and join a Florida lawsuit fighting for gay adoptions. But from Rosie's first issue in May 2001, O'Donnell clashed with G + J CEO Dan Brewster and his staff-in part because her ideas went against conventional wisdom about what sells magazines. She wanted celebrities on the cover who had something to say even if they were out of the public eye, like her friend Fran Drescher, who has survived cancer, and Christopher Reeve, whom she found personally inspiring (she got Drescher on the first cover; editors balked at Reeve). She wanted social issues she believed in, like adoption, to appear as regular features. She also fought for stories that showcased friends and relatives, like the wedding of Carpenter's stepsister Heidi Safer. "I wanted a magazine that celebrates real women," she says, "that understands that they care about more than their waistline or the latest makeup styles or fashions, that they want to be relevant and help each other and care about the world, that they are smart enough to tackle issues in society that women's magazines think they are too stupid for."

After an initial spike, newsstand sales declined from 875,000 to 300,000. And although many of O'Donnell's ideas sold well -- including a July '01 cover story about her staph infection -- "sometimes," says one insider, "Rosie would push for covers that weren't good." (Her suggestion of Boy George was rejected.) The acrimony between O'Donnell and Brewster continued to build, reaching a head in July, when the magazine's founding editor, Cathy Cavender, was replaced by Susan Toepfer (a former editor at PEOPLE). "They got into an absolutely terrible wrangle," a Rosie source says of O'Donnell, Toepfer and Brewster. O'Donnell admits screaming at Toepfer via speakerphone on her third day because the editor wanted Rosie to appear with the stars of The Sopranos on the cover, and O'Donnell wasn't interested. "She said, 'Fact is, it will sell more with you on the cover.' Fact is, when I am mad, I am mad," recalls O'Donnell, who says she never wanted to appear on covers but was persuaded to by G + J.

Brewster called a meeting and told the staff that Toepfer was in charge of the day-to-day running of the magazine, not Rosie. O'Donnell was incensed, all the more because the meeting was held in her personal office while she was away. "Unfortunately, it escalated, and I yelled at the CEO," O'Donnell says. "I told him this was not the deal we made. I said, 'This is America. You don't own my name.' " On another occasion, insiders say O'Donnell warned staffers, "If there is one more leak to the press, then Rosie is through. All of this affects you a lot more than it affects me. I'm already a f------ millionaire." (O'Donnell says she wasn't threatening -- or bragging -- just pointing out what was at stake.)