Defence Minister Lord Drayson has taken a "leave of absence" from the government in a bid to take part in the world-famous 24-hour Le Mans race.
Lord Drayson said he wanted to take racing "to the next level"
The 47-year-old is resigning from his unpaid post to take part in a series of qualifying events in the United States.
A government spokesman said it was "a key step towards his eventual dream of success" in Le Mans.
But a mother whose son died in Iraq because of a lack of proper kit said: "It's really insensitive timing."
A coroner has ruled that an Army logistics failure led to the unlawful killing Fusilier Gordon Gentle, 19, who was killed by a roadside bomb in Basra in June 2004.
His mother, Rose, 43, from Glasgow, said of Lord Drayson's move: "He should be at his desk, not trotting off to some race. It just shows another breakdown in the chain of command.
"I think the servicemen and women are more important than him doing a motor race."
Lord Drayson, who became a minister in 2005, came second in the British GT championship this year, driving a "unique bio-ethanol-fuelled" car.
The American Le Mans series involves four different classes of car, with the winner of each class going on to take part in the main 24-hour race, in France.
In a letter to Prime Minister Gordon Brown, Lord Drayson said: "As you know I have a passion for motor racing and over the past year have competed in the British GT championship racing a unique bio-ethanol fuelled race car, achieving a 'historic first' win for a green-fuelled car and coming second overall in the championship.
"A number of special circumstances have now presented me with a once-in-a-lifetime opportunity to take my racing to the next level.
"I have the opportunity to race next year in the American Le Mans series in the US, a key step towards my eventual dream of success in the Le Mans 24-hours endurance race."
He said next year was the first time bio-ethanol cars would be allowed to compete, adding: "So this is a wonderful opportunity to showcase British motorsport technology for environmentally friendly racing."
Lord Drayson, who in 2004 was Labour's biggest individual donor, having made a fortune in the technology business, said: "Unfortunately it cannot be combined with the challenge of full-time government office."
Mr Brown wrote to say he was sorry to lose him and looked forward to "your return to government when your leave of absence ends".
He added: "I understand your desire to take up the extraordinary opportunity which has now emerged to achieve your great life's ambition.
"You are of course lucky to have that opportunity but you are showing your customary boldness and imagination by pursuing it."
Defence Secretary Des Browne said he was "sorry to see Lord Drayson leave government".
"He has worked tirelessly for over two years to improve the way in which we equip our forces," he said.
But former shadow defence secretary Bernard Jenkin, a member of the Commons defence select committee, said the peer's decision to step down was actually a "disaster" for the Ministry of Defence, who he accused of trying to cover up what was in effect a resignation.
"He has been a good procurement minister...He's walking away from a terrible mess because the spending review leaves the MoD short of around £1bn over the next three years," he said.
"The idea he is taking leave of absence and is going to return to the MoD at a latter date is utterly ridiculous. This is a resignation and they are trying to hide that fact."
Lord Drayson's job as defence procurement minister job has gone, on a permanent and paid basis, to Baroness Ann Taylor.
The Le Mans 24-hour race has been held since 1923. The American series started in 1999.