The former Tory cabinet minister told a conference of Europhobe groups in London that potential supporters of the campaign could be "driven away through the use of extremist language". He described himself as "one who has not always spoken moderately in the past".
The motives of the founding fathers of the Treaty of Rome, who aimed to rid the continent of wars, were "understandable", he said. But he warned: "It is complete folly to believe that you will abolish extreme nationalism in Europe by abolishing nation states in Europe. When we risk creating again a lack of democracy and causes of contention and grievance in Europe, that is dangerous not just for Britain but for all our continent."
Mr Portillo was speaking at the launch of the Congress for Democracy, which has been set up to seek to bring together the many groups who oppose the single currency. The groups' impact has been weakened by divisions and rivalries amongst themselves.
The organisers included Labour MP Austin Mitchell and Sir Michael Spicer, a Tory MP and leader of the European Research Group. This has been at odds with the rival European Foundation headed by Bill Cash, another Tory MP whose presence at yesterday's launch was seen as a hopeful sign that a united front might be forged against the euro.
Sharp differences emerged during a debate on tactics. Pam Barden, from the Labour Euro-Safeguards Campaign, accused the Business for Sterling Group of "letting down" British trade because they were in favour of a single market when 80 per cent of British businesses were trading within Britain. "We want you to come out and say you want a free trade area," she said. Similar criticism was voiced by Lord Pearson of Rannoch, a Tory peer and prominent member of the Global Britain Group. Bernard Jenkin, Tory MP for Essex North, cautioned the different groups that "everyone had axes to grind and packages to buckle".
Peter Lewis, who organised the campaign for a referendum on the Maastricht treaty, added: "We have to be focused and must be disciplined ... otherwise they will always use the argument it is us against them and we will lose it."
About 250 representatives from 50 organisations, including trade unions, political parties and pressure groups, agreed a statement warning that the single currency was "designed to bring about political as well as economic union" and would mean interest, exchange and tax rates being set by institutions not accountable to the British people. They agreed to mount "a national campaign in defence of sterling".