John Longworth resigned on Sunday night as director-general of the British Chambers of Commerce after being drawn into a political row over his support for the UK to leave the European Union.
The surprise decision illustrates the increasingly febrile atmosphere around the impending referendum on EU membership on June 23.
The support of major business figures is seen as critical by both camps given the fundamental economic arguments over Brexit.
The Financial Times revealed on Friday evening that Mr Longworth had been suspended after making several high-profile interventions in favour of leaving the EU.
Critics within the organisation claimed that he had breached the group's self-ordained position of neutrality over the June referendum.
On Sunday, Boris Johnson, London mayor, suggested, without any evidence, that the government might have engineered the suspension. The comments prompted an angry denial by Number 10.
At 10pm the same evening the BCC issued a statement saying that Mr Longworth had resigned and that there had been no political interference.