Lord Mandelson has revealed his fury at West Midlands MP Tom Watson, in his autobiography detailing the untold story of New Labour.

He claims Mr Watson, MP for West Bromwich East, was acting under orders from Gordon Brown when he led a rebellion against Tony Blair which succeeded in forcing the former Prime Minister to quit Downing Street early.

But speaking to the Birmingham Post, Mr Watson denied the claims – and said he would set out what really happened in his own biography, telling the truth about the New Labour years.

The row dates back to 2006, when Mr Watson was seen as the ringleader of an attempt by Labour MPs to force Mr Blair out by signing a letter demanding his resignation.

Mr Watson resigned from his position as a defence minister at the same time. Although he was a friend and ally of Gordon Brown, then Chancellor, he has always denied Mr Brown was involved in the plot.

The coup, in 2006, forced Mr Blair to abandon his pledge to serve a full third term in office – which would have meant remaining in Downing Street until 2009 or 2010 – and he resigned in June 2007, allowing Mr Brown to take over.

In his autobiography, The Third Man, Lord Mandelson lays bare the internal battles which he claims sabotaged Tony Blair’s government.

Giving his account of the revolt, he writes: “Now Gordon was ready to move. The claim that he knew nothing in advance of the backbench plot over the week that followed is frankly incredible: the ringleader, Tom Watson, the Labour MP for West Bromwich East and one of Gordon’s closest allies, would not in those days have blown his nose without Gordon’s say-so.”

He adds: “Given that Tom was a fully-fledged member of Team Brown, who owed his promotion as a junior defence minister to Gordon’s lobbying, any pretence that Tony’s next-door neighbour was a mere spectator was now gone.”

And Lord Mandelson claims former Birmingham Erdington MP Sion Simon (Lab) was enticed to join the plot because he was angry at not being given a Ministerial job by Mr Blair. But Mr Blair was spared having to give in to demands to resign immediately because of a backlash against the plotters from party activists.

“What ultimately turned the tide was that not only in the Commons, but across the party, there was growing anger. Most of it was directed at Tom Watson, but only slightly less at Gordon himself. The Labour Party switchboard, website and email in-baskets were full of messages voicing fury at the way Tony was being treated.”

Lord Mandelson admits that his anger continued even after Gordon Brown asked him to return to government in 2008 as Business Secretary, after four years way from Westminster as a European Commissioner in Brussels.

But he says he received a warm welcome from Mr Watson and other Brown footsoldiers such as Dudley North MP Ian Austin.

“There was a similarly rapid rapprochement with people like Ian Austin and even Tom Watson, close Gordon aides who had previously worked against me and Tony, but who now welcomed me back.”

Mr Watson said: “One day I will get around to writing an accurate account of my side of the New Labour story. “Over the years I have defied the will of Tony, Gordon and Peter, much to their fury on occasion.

“I think Peter’s account of my resignation is just supposition.”