The Scottish Secretary, Mr Donald Dewar, last night suspended the Labour backbencher Mr Tommy Graham, who is accused of taking part in a smear campaign against another MP, Mr Gordon McMaster, who committed suicide last month.
Mr Graham, the MP for Renfrewshire West, has consistently denied the allegations that he attempted to blacken the reputation of his colleague, who claimed in his suicide note that Mr Graham had indulged in a "dirty tricks" campaign against him.
The decision to discipline Mr Graham comes ahead of the initiation of a full investigation of Labour politics in Scotland - which has a reputation for viciousness - by the party's ruling body, the National Executive Committee (NEC).
Mr Graham now faces a form of internal exile after being suspended from the parliamentary party pending an investigation.
An inquiry by the British government's Chief Whip, Mr Nick Brown, into the circumstances of Mr McMaster's suicide last month is understood to have concluded that Mr Graham and his supporters in Paisley did conspire to bring into disrepute the characters of three Labour MPs.
They were named as Mr McMaster, Ms Irene Adams, the MP for Paisley North, and Mr Norman Godman, the MP for Greenock and Inverclyde.
The inquiry also has gathered evidence to accuse Mr Graham of taking part in a whispering campaign against Mr McMaster which involved spreading rumours about his private life, including claims that he was gay and suffering from AIDS.
However, the report has made it clear that Mr Graham was not responsible for the suicide of Mr McMaster, who it said was clinically depressed over his diagnosis of organo-phosphate poisoning as a result of his work as a professional gardener.
On several occasions yesterday the speculation over Mr Graham's future threatened to overshadow the presentation of the British government's yes-yes campaign for Scottish devolution.
At an Edinburgh press conference, Mr Dewar deftly avoided any direct questions about Labour's inquiry in Scotland. Mr Dewar said the "complications and distractions" of the last few days were "nothing to do with the devolution campaign".
Keen to ensure that the focus of media attention was on devolution and not on Mr Graham, he said: "This press conference is not about that. I hope you will respect that."
However, only days ago senior Labour figures in Scotland threatened to protest to the party in London unless the move to discipline Mr Graham was swift.