A new report has rated Torridge District Council in north Devon as "poor".
Criticisms levelled at Torridge include poor leadership, patchy services and inappropriate behaviour by some senior councillors, including verbal abuse.
Twenty one reports have been released across the country in the government's Comprehensive Performance Assessments (CPA).
Torridge is the only one so far to get the bottom grading of "poor", while Exeter City Council and South Hams District Council are among just four to be named "excellent".
Torridge came under fire in May following an interim CPA report.
The report said the bullying attitude of a few councillors was responsible for a climate of fear that made the council directionless, archaic, and under-performing.
It said women, in particular, were bullied, and the atmosphere created by just a few members of the council had led to serious stress and poor performance.
Ian Carter from the Audit Commission, which produced the latest report, said: "The quality of services in Torridge was generally quite good.
"We were more concerned about how the council is managed or has been managed and how clear it is about the future."
Anti-bullying policies
Torridge Chief Executive Trevor Smale said: "Certainly there have been problems in the last three or four years but on average the services we provide are fairly good and that is something we can build on."
He said that a "whole series of policies" had been enacted to deal with the problems of bullying.
An independent investigation was due to report on the progress that the council had made on the issue and would make recommendations.
Mr Smale said: "We are taking this report extremely seriously. It is a wake-up call to Torridge District Council and we intend to come up with improvements in the next two months which will enable us to become a much better council in the next four to five years."
In the rest of the county, East Devon, West Devon and Teignbridge councils were rated "good".
Reports on Mid Devon and North Devon are still awaited.