The funnyman, who appeared on the hit sketch show from 1995 to 2002, explains writers dared him to interrupt the music mogul while he was onstage in 1998 - and Will took on the challenge, in character, as his pompous newsman Ron Burgundy.
"We were watching Puff Daddy rehearse (and) someone said, 'Ron should go up onstage', and before everyone turned to see, I had sprinted out the door," Ferrell said while reliving the madcap moment during a new episode of web series "Stories From the Show".
"I didn't really know what to do when I got up there," Ferrell said as he watched a clip of the hilarious moment. "Then we shook hands."
The "Anchorman" star revealed he often fooled around behind the scenes on the show to liven up the serious backstage atmosphere.
"I was always kind of awestruck at how serious the place could be at times, and I thought 'Wait, this is a comedy show, we should be f**king s**t up'."