US ambassador Sir Kim Darroch backed the controversial "Trump dossier" compiled to smear the President.
The British envoy endorsed ex-British spy Christopher Steele, who drew up the document full of lurid claims.
He told a US official the intelligence expert was "legit" - even before the dossier was made public.
Sir Kim quit his role earlier this week after falling out with Donald Trump.
The President lashed out when it emerged the ambassador had called him "clumsy and inept" in leaked diplomatic cables.
It has now emerged that Sir Kim was involved in a previous Trump controversy.
In 2016, Mr Steele compiled a dossier claiming that Russia was working on behalf of the President's election campaign.
Among the outlandish claims was an assertion that the Putin government had a video of Mr Trump having sex with prostitutes.
It said he had paid women to pee on his bed in a Moscow hotel room - a suggestion furiously denied by the President.
When versions of the dossier first started circulating in Washington, officials were keen to hear Sir Kim's views on Mr Steele.
According to the New Yorker, one aide in the State Department met him at a party and asked: "Is this guy Steele legit?"
The ambassador replied: "Absolutely."
It's not known if he commented on any of the specific allegations from the document.
Last night it emerged that Sir Kim accused Mr Trump of ditching the nuclear deal with Iran out of spite towards Barack Obama.
Scotland Yard is now investigating who leaked the secret cables to the press.