Mr Heseltine's comments, in today's Sunday Times, appeared to give credence to claims from Sir Edward Heath that the Cabinet is split over its approach to the IGC negotiations.
Mr Heseltine said John Major had demonstrated at Maastricht how negotiation could further Britain's interests - even if concessions were made. He added: "How else do you advance negotiations? There is another way - wrap yourself in the national flag andgive not an inch.
"You will earn the plaudits of the crowd and attract today's macho headlines. But the Conservative Party, on its long journey into Europe, has not followed simply in the slipstream of every sudden squall of opinion."
Earlier, Sir Edward said several unnamed Cabinet ministers had told him that Michael Portillo, Secretary of State for Employment, had gone beyond Cabinet agreement when he said the Government would veto moves towards greater political union at the 1996 inter-governmental conference.
The former premier added that Mr Major had "no excuse for overthrowing the principles which the great majority of the party in the House of Commons support and which we have supported as a party ever since we went into Europe".
At the World Economic Forum in Davos a week ago Mr Portillo said Britain would object to changes designed to weaken Britain's veto, to further political union or to increased power for the European Parliament.
Sir Edward's claim of a Cabinet split was rejected by Downing Street which said Mr Portillo's comments had been in tune with policy outlined by John Major last month.
The row followed Friday night's speech in which Mr Major said that a single currency could "tear the European union apart" if entered without the right economic conditions.