Tony Blair did not know a key piece of Iraq intelligence had been discredited when he gave evidence to last year's Hutton inquiry, Downing Street says.
Mr Blair has said he accepts Lord Butler's findings
MI6's decision to withdraw the intelligence was made before August 2003's Hutton inquiry, according to Wednesday's Butler Report.
But Mr Blair had not known this when he gave evidence to the inquiry, Downing Street said.
The first he heard of it was "as a result of the Butler inquiry".
The intelligence report, described as being from a "new source on trial", on alleged Iraqi production of chemical and biological weapons was received in mid-September 2002 - too late to be included in the Joint Intelligence Committee's assessment.
But according to Lord Butler it gave extra assurances to those drafting the government's September 2002 dossier that production of WMD was taking place.
The source "had a major effect on the certainty of statements in the government's dossier of September 2002 that Iraq possessed and was producing chemical and biological weapons. (This report was subsequently withdrawn.)," the Butler report says.
A second intelligence report, from the same source, about the production of a particular chemical agent, was also received later in September 2002.
Both reports were withdrawn by MI6 on 17 July 2003, weeks before the Hutton inquiry - with this withdrawal made known to the Foreign Office and Joint Intelligence Committee.
"We note therefore that the two reports from this source including one that was important in the closing stages of production of the government's September dossier must now be treated as unsafe," the Butler report says.
Mr Blair was not aware the intelligence had been discredited at the time of the Hutton inquiry, Downing Street said.
The prime minister's official spokesman said Mr Blair only became aware it was unsafe "as a result of the Butler inquiry".
He said the piece of intelligence in question "was only one issue" and was "not relevant" to the Hutton inquiry, which was focused on the death of Dr David Kelly and the separate claim that Iraq could launch WMD within 45 minutes.
It would have been "improper" to talk about it publicly as intelligence sources had not been "validated", he added.
Earlier, Health Secretary John Reid said the government's "good faith" had been established by four inquiries - and there was no need for another one.
But Lib Dem leader Charles Kennedy said the latest revelations showed the need for a further inquiry into the political decisions that led to war.
"Unless you have a proper public inquiry ...which can call political players to proper account, you will not satisfy public opinion," Mr Kennedy told BBC Radio 4's Today programme,
The Liberal Democrats' by-election success in Leicester South reflected that people were still concerned about the Iraq war, he says.
"Iraq remains a predominant concern. It would be a strange democracy if it did not," he said.
Mr Kennedy said he would be asking the Prime Minister Tony Blair in the House of Commons next week about the claims that information was withheld from the Hutton Inquiry.
Dr Reid rejected calls for further inquiries into the Iraq war as "hunting for someone to blame".
But Eric Illsley, a Labour MP on the foreign affairs committee, said that the withdrawal of the intelligence - and the uncertainties about the dossier - should have been made public.
"Anyone reading the dossier today would still think it was a relevant document and all the information in it was secure intelligence gathered at the time," Mr Illsey told BBC Radio 4's World at One.