British spies listened in to UN Secretary General Kofi Annan's office in the run up to the Iraq war, former UK cabinet minister Clare Short says.
Ms Short says she expects there are transcripts of calls to Mr Annan
Ms Short said she had read transcripts of some of Mr Annan's conversations.
She said she recalled thinking, as she talked to Mr Annan: "Oh dear, there will be a transcript of this and people will see what he and I are saying."
Tony Blair said the claims were "deeply irresponsible" and appeared to cast doubt on her future as a Labour MP.
UN officials said they did not know whether the allegations were true or not, but say such actions would have been illegal.
The secretary general's spokesman, Fred Eckhardt, said Mr Annan had nothing to hide and that anyone who wanted to know his opinion on an issue just had to ask him to his face.
At his monthly news conference the prime minister was repeatedly asked about Ms Short's comments.
Mr Blair said: "I'm not going to comment on the work of our security services - do not take that as an indication that the allegations made by Clare Short are true.
Clare Short has been a thorn in the government's side since she quit
"I really do regard what Clare Short has said this morning as totally irresponsible, and entirely consistent."
Asked whether she should be prosecuted or face Labour Party discipline Mr Blair said he would "have to reflect upon" her comments, adding: "There will obviously be issues that arise... I am not in a position to answer them at the moment."
He insisted the UK security services acted in accordance with domestic and international law and in the best interests of this country, but the UN said any British spying on Mr Annan would be illegal.
Ms Short's comments came the day after the dramatic collapse of the trial of GCHQ whistle-blower Katharine Gun.
She had been accused of leaking a secret e-mail from US spies apparently requesting British help in bugging UN delegates ahead of the Iraq invasion.
The government says it will review whether changes are needed to the Official Secrets Act in the wake of the case.
But it has denied claims the move to drop the case was politically motivated.
There has been speculation ministers were worried about the disclosure of secret documents during the trial, particularly the advice from Attorney General Lord Goldsmith about the legality of war.
Lord Goldsmith said in a statement to the House of Lords: "It was a decision on solely legal grounds ... and free from any political interference."
Spies there 'for some time'
He said that although they believed they could prove the Official Secrets Act had been breached, they had concluded they could not disprove Mrs Gun's defence "of necessity" - believed to refer to her case that she felt a duty to do something to save lives in an unlawful war.
However, Mr Blair said it would be a "very dangerous situation" if people thought they could just "spill out allegations, whether false or true ... and get away with it".
During an interview on BBC Radio 4's Today programme Ms Short said British spies were involved in bugging Mr Annan's office in the run up to war with Iraq.
"The UK in this time was also getting spies on Kofi Annan's office and getting reports from him about what was going on," she said.
"These things are done and in the case of Kofi's office, it was being done for some time."
Asked if Britain was involved in this, she replied; "Well I know - I've seen transcripts of Kofi Annan's conversations.
Asked to confirm if British spies were instructed to carry out operations within the UN on people like Mr Annan, she said: "Yes, absolutely."
BBC security correspondent Frank Gardner said that many UN officials always worked on the basis that they were being bugged.
But, he added, "that is not to say that it is acceptable if they are not suspected of terrorism or other crimes".
Conservative leader Michael Howard said the situation was "a complete mess".
"It's about time the prime minister got a grip on it and sorted it out," he said.
Liberal Democrat leader Charles Kennedy said it was not good enough for Mr Blair to say he could not comment on the security services - especially after publishing intelligence in his Iraq dossiers.
"Tony Blair must now come clean about this central accusation," he said.