Iranian President Mahmoud Ahmadinejad has come under fire from leading hardliners for naming as his top deputy a man who said Iran was friends with everyone, including arch-foe Israel, local media said on Sunday, according to Reuters.
Iran's state-run English language Press TV said Esfandiar Rahim Mashaie "no longer wanted the job" of first vice president and had resigned because of the row.
There was no immediate confirmation of the decision.
Analysts say Thursday's decision by Ahmadinejad to appoint Mashaie, to whom he is related by marriage, suggests that the president has a small entourage of people he trusts.
Ahmadinejad was re-elected in a June 12 presidential vote, which stirred the largest display of internal unrest in Iran, the world's fifth biggest oil exporter, since the 1979 islamic revolution and exposed deep rifts in its ruling elite.
Iran, which has accused Western countries of fomenting the unrest, on Sunday released a local British embassy employee, Hossein Rassam, on $100,000 bail, his lawyer said.
Rassam was the last employee still in detention of nine Iranian British embassy staff held late last month for alleged involvement in mass street protests following the election.
Defeated pro-reform candidates say the vote was rigged, but the latest criticism of Ahmadinejad came from conservatives.
In rare public criticism, Ayatollah Ahmad Khatami, an Ahmadinejad ally and member of Iran's top legislative body, said on Sunday that Ahmadinejad had shown "a twisted face to clerics and elites" by appointing Mashaie last Thursday.
"Ahmadinejad should not challenge conservatives with such decisions. I request the president to replace him before more criticisms are made," the hardline cleric was quoted as saying by the Khorasan newspaper.
Mashaie, whose remarks on Israel in 2008 created a storm at home, was previously one of several vice presidents and in charge of a culture and tourism body.
There are still many hardliners who back the president, such as Ayatollah Mohammad Yazdi, who said in remarks published on Saturday that the Iranian government drew its legitimacy from "the Almighty God."