The Tory peer accused of publishing "lurid nonsense" about the Prime Minister because he was not given a senior ministerial post could be dismissed as a Government adviser.
Lord Ashcroft, a billionaire donor to the Conservatives, has used a book to accuse David Cameron of being a member of a "debauched" Oxford University society that engaged in "bizarre rituals and sexual excess".
He is expected to make a series of further claims about the Prime Minister's involvement in hunting as well as allegations about members of Mr Cameron's social circle. Lord Ashcroft is still employed by the Government as Mr Cameron's "special representative for veterans' transition" and sources have suggested his position could now be reviewed.
In the book, Call Me Dave, Lord Ashcroft claims that Mr Cameron was part of a "dope smoking group" with friends while he studied at Oxford. He alleges a pig's head was produced by a member of Oxford University's Piers Gaveston Society at an event and that Mr Cameron "inserted a private part of his anatomy into the animal's mouth".
Sources close to Mr Cameron said the claim about the pig's head was "total c--p".
In his foreword to the book, Lord Ashcroft admits he has a personal "beef" with the Prime Minister because he was not given a "significant" Government job in 2010. One source said: "This is a man who didn't get the job he wanted. Now he just looks like a rich guy who didn't get his way and is deeply unhappy about it." Another friend of the Prime Minister said: "It's salacious gossip that doesn't appear to be being taken seriously in any way. It's lurid nonsense."
A former girlfriend of Mr Cameron has also dismissed Lord Ashcroft's claims as "complete nonsense", claiming that the future Prime Minister was the "straightest man at Oxford".
Catharine Snow, whom Mr Cameron dated in his first term, told The Daily Telegraph that she refused to read the claims in the book but she insisted Mr Cameron was never a member of a "debauched" Oxford society. Ms Snow, 49, who remains his friend, said: "It's a load of nonsense. I always teased him that he would be Prime Minister at Oxford because he just absolutely removed himself from anything.
"He was just completely straight - the straightest at Oxford. We used to give him hell."
Valentine Guinness, one of the founders of the Piers Gaveston Society, told The Spectator: "It is a ridiculous story. As far as I know David Cameron was never a member of the Piers Gaveston Society, so there would have been no need for an initiation ceremony. He may well have attended one of their parties, but the pig's head story is purely malicious gossip."
Mr Cameron's official spokeswoman said: "I am not going to dignify this book with any comment. The author has set out his reason for writing it."
Lord Ashcroft states that he began his dispute with the Prime Minister after Mr Cameron failed to honour a promise to give him a "significant" job if the Conservatives won the 2010 general election. He claims Mr Cameron told him that Nick Clegg, Lib Dem leader during the coalition government, had blocked his appointment. However, Mr Clegg told the BBC that he did not recollect being asked permission to give Lord Ashcroft a senior job.
It is also claimed that Lynton Crosby, the Australian strategist who masterminded Mr Cameron's 2015 election victory, described the Prime Minister as a "tosser".
However, a friend of Mr Crosby said: "The only evidence you need to know what Lynton Crosby thinks about David Cameron is that he gave up three years of his life to help him get elected as Prime Minister."