Keir Starmer's ally Lord Mandelson has suggested Barack Obama should make Joe Biden quit despite the PM publicly defending the US president.
The New Labour architect said Mr Obama would have to 'take a position' and 'step in', claiming that his aides could have been behind a devastating intervention from Hollywood star George Clooney.
The peer - who has been tipped by some as the next ambassador to the US - also warned that vice-president Kamala Harris needed to recognise there is no 'consensus' that she would be the best replacement.
The comments, on BBC Newsnight, reflect growing concern in Labour circles about the prospect of Donald Trump winning the race for the White House in November.
Although Sir Keir has insisted he would work with whomever is president, Mr Trump would be a far trickier prospect for a left of centre government.
Mr Biden held a rare unscripted press conference as the NATO summit wrapped up in Washington last night, in an effort to allay fears about his dwindling mental capacity.
However, the move backfired as the the 81-year-old commander-in-chief said Mr Trump was his vice-president, heaving earlier introduced Ukraine's Volodymyr Zelensky as 'President Putin'.
At his own press conference, Sir Keir tried to put a brave face on questions about the president's condition.
President Joe Biden introduced Ukrainian President Volodymyr Zelensky as 'President Putin ' in a brutal gaffe at the NATO summit with his political future hanging by a thread
The 81-year-old facing mounting calls to drop out of the presidential race said: 'Ladies and gentlemen, President Putin'
The PM told journalists 'I would urge everyone to look at the substance of what's been achieved over these two days' over support for Ukraine.
He said: 'When we think of the global threats, that is the best possible outcome we could have had today and so I think he deserves credit for that, as does the team that worked with him.
'We close this council with renewed confidence and resolve to meet the challenge of Russian aggression. That is the outcome we all hoped we would get to and President Biden led us through that.'
Sir Keir sidestepped a question about whether Mr Biden was capable of serving four more years in the White House, instead again focusing on the outcomes of the Nato summit.
But Lord Mandelson, who is well connected on both sides of the Atlantic, was less circumspect.
'The initiative is going to pass to President Obama and Mrs Obama. President Obama as the most recent ranking Democrat president is now going to have to take a position,' he said.
'I've heard that the article that was written, authored by George Clooney, was actually written by Obama aides which might suggest where Mr Obama might stand.
'I think he's not just got to talk very frankly to President Biden I think he's got to talk quite frankly to his friend Vice President Kamala Harris.
'Because I really don't think there will be a consensus in the Democrat Party that should Mr Biden step back, as I think most now want him to do, the better replacement as candidate would be Vice President Kamala Harris.'
Lord Mandelson - who denied he was in the frame for US ambassador - suggested Mr Biden could stand by his achievements but acknowledge he was 'tired' and has 'had his day'.
At a press conference at the conclusion of the Nato summit, Sir Keir repeatedly dodged questions about Mr Biden's blunder
President of Ukraine Volodymyr Zelensky (L), British Prime Minister Keir Starmer (2-L), US President Joe Biden (2-R) and NATO Secretary General Jens Stoltenberg (R) attend a meeting of the NATO-Ukraine Council during the summit
Responding to questions about Mr Biden's mental capacity, the Prime Minister told journalists 'I would urge everyone to look at the substance of what's been achieved over these two days' over support for Ukraine'
Mr Biden has been facing mounting alarm from Democrats after a dire performance in the first TV debate against Mr Trump last month.
The president introduced Mr Zelensky as 'President Putin' at an event attended by Sir Keir at the Nato summit in Washington.
He immediately corrected himself, saying: 'President Putin? He's going to beat President Putin. President Zelensky.
'I'm so focused on beating Putin, we've got to worry about it.'
Sir Keir, who met the president for their first bilateral talks at the White House on Wednesday as Nato leaders gathered in Washington to discuss the challenges facing the bloc, said Mr Biden had been 'across all the detail'.
Before Mr Biden's latest slip-up, Sir Keir had told broadcaster their one-to-one discussions had happened 'at pace' and Mr Biden seemed 'on really good form'.
'We were billed for 45 minutes, we went on for the best part of an hour,' he said.
'He was absolutely across all the detail. We were going at pace through a number of issues.'
Asked whether the president was senile, Sir Keir told the BBC: 'No... he's shown incredible leadership.'
The president has stood firm against suggestions he should drop his candidacy and appealed for an end to the row over how the party moves forward in a sharply worded letter to Democrats.
Legislators and fundraisers including Clooney have since joined calls for Mr Biden to step aside, after he appeared flustered and stumbled over his words in the presidential debate with Mr Trump last month.
