Gulf war syndrome may have been caused by exposure to the nerve gas sarin, according to reports.
Some 6,000 Gulf veterans have suffered from various complaints
New Scientist magazine has reported a leak of a US inquiry into the ill-health of veterans of the 1991 war.
The US Department of Veterans Affairs' Research Advisory Committee on Gulf War Veterans' Illnesses is due to publish its findings next week.
But the magazine said researchers have found neural damage consistent with the nerve agent used by Saddam Hussein.
The link is said to have been "crucial" to a change of heart by the US authorities over Gulf war syndrome.
The New York Times newspaper reported last month that US scientists believed the syndrome did exist and was caused by "toxic exposure" but it was not clear whether this was from drugs or nerve agents.
The UK government has always insisted a unique Gulf war syndrome does not exist.
But campaigners say 6,000 British war veterans are suffering from the syndrome, with symptoms ranging from mood swings, memory loss, lack of concentration, night sweats, general fatigue and sexual problems since the war.
According to the New Scientist report "a substantial proportion of Gulf war veterans are ill with multi-system conditions not explained by wartime stress or psychiatric illness".
Instead, the magazine reported the ill-health could have been caused by low-level exposure to sarin.
Three research groups had independently found specific kinds of neural damage that could explain some of the veterans' symptoms.
These veterans also had lower levels of an enzyme which breaks down sarin-like compounds.
British and US authorities have always denied that any troops were affected by nerve gas, as no soldiers showed the classic symptoms of acute exposure.
But the New Scientist said: "It now appears that very small, repeated exposure can also harm."
Experiments on animals have shown that exposure to doses of sarin too low to cause observable or immediate effects causes delayed, long-term nerve and brain damage similar to that seen in veterans, the magazine said.
Troops could have had low-level exposure to chemical weapons throughout the war.
A Senate investigation heard in 1994 that each of the 14,000 chemical weapons alarms around the troops went off on average twice or three times a day during allied aerial bombardment of Iraq - a total of between one and two million alarms.
All were said to have been false alarms. However, evidence was mounting that soldiers might in fact have been exposed to sarin, the New Scientist said.
Another source of exposure could have been for the thousands of troops stationed near Khamisiyah in southern Iraq in March 1991.
After the fighting was over, a large chemical weapons dump was blown up, creating a plume of gas, which would have contained sarin and which could have affected at least 100,000 allied soldiers, possibly far more, the New Scientist said.
Shaun Rusling, vice chairman of the National Gulf Veterans and Families Association, said: "I agree with the findings, it is what we expected.
"It is absolutely ridiculous for the MoD to deny Gulf war syndrome does not exist. UK troops were exposed to sarin and this, along with the multiple vaccinations troops were given and exposure to depleted uranium, has caused the illnesses."
The Ministry of Defence said it would not comment on leaks.
A spokeswoman said: "Our understanding is that the report only reviews existing research. In our view, research to date has shown there is insufficient evidence to support the existence of Gulf war syndrome."
She said the UK was considering whether or not to carry out further research, testing the urine of veterans exposed to sarin, on the advice of the Medical Research Council.
She said similar investigations were currently being conducted in the US on 400 veterans, 200 of whom are Gulf war veterans.
"So it might be that it won't be necessary for the UK to do that work," she said.
The MoD has released a report on the medical lessons learned from the first Gulf war.
It says it has made significant improvements to a wide range of its policies and procedures which have contributed towards the successful deployment and conduct of the more recent military operations in Iraq.