John Prescott, the party's deputy leader, dismissed an attack by one of his backbench MPs, Richard Burden, as "summer madness".
Writing in the New Statesman, Mr Burden criticised Mr Blair's "ruthless" vote-chasing and said the party was "desperate" to present itself as "mainstream", but with "its inner sanctum holding a virtual monopoly on defining what mainstream opinion consists of".
Mr Prescott rejected the charge that power was being centralised in the Labour leader's office.
With most Labour MPs - including Mr Burden - on holiday, support for his remarks yesterday came from members of the left-wing Campaign Group.
Max Madden, MP for Bradford West, criticised the leader's advisers as "little rooms with little groups of people exercising enormous influence", while Jeremy Corbyn, the Islington North MP, estimated that up to 100 Labour MPs were also "upset at the direction in which the party is being moved".
Mr Burden also appeared to be supported by John Edmonds, leader of the GMB general union.
"Permanent revolution is exciting but it is also profoundly upsetting. Unless each issue is chosen with precision, after a time people complain about change for change's sake," he wrote in the left-wing Tribune newspaper. He called on Mr Blair to "restate Labour's longstanding principles".
Asked if he were a member of Mr Blair's inner sanctum, Mr Prescott laughed: "I've never been an inner-sanctum man in my life."
He further rejected the attack on Labour's campaign in the Littleborough and Saddleworth by-election, which Mr Burden said "represented a kind of political amorality in which anything goes as long as it looks like being to our electoral advantage".
Robin Cook, Labour's foreign affairs spokesman, dismissed the criticism as the remarks of just one individual, adding: "One-third has been added to the membership of the party in the last year - that's not a sign the Labour Party is discontented and demoralised."
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