One of Boris Johnson's closest aides, director of communications Lee Cain, has resigned amid reports of internal tensions in Downing Street.
He will leave next month, despite being offered a promotion to chief of staff.
His departure prompted speculation about the future of the PM's chief adviser Dominic Cummings, but the BBC was told he would stay for now.
No 10 denied Mr Johnson had been distracted by the saga, saying he was "fully focussed" on tackling Covid.
Mr Cain has been at the PM's side since he was a press officer for the Vote Leave campaign under Mr Cummings.
Many will not have heard of him before the story broke, but his resignation comes at a time when the government is facing big decisions over its coronavirus strategy and the future of post-Brexit trade with the EU.
After a number of rows and U-turns within government in recent months, No 10 will see communications as key in connecting with the country and trying to gain support for its decisions.
The news that Mr Cain - who worked with Mr Cummings and the PM in the Vote Leave campaign to get Britain out of the EU - could become Mr Johnson's chief of staff had led to consternation among some MPs and ministers, said BBC political editor Laura Kuenssberg.
One Tory source even suggested that Mr Johnson's fiancee, Carrie Symonds - a former head of communications for the Conservatives - had misgivings about that plan.
Labour leader Sir Keir Starmer told LBC Radio: "This is pathetic. I think millions of people will be waking up this morning, scratching their heads, saying what on earth is going on?
"We're in the middle of a pandemic, we're all worried about our health and our families, we're all worried about our jobs, and this lot are squabbling behind the door of No 10. Pull yourselves together, focus on the job in hand."
But the PM's spokesman said Mr Johnson was concentrating on fighting coronavirus, adding: "You can see the progress we are making, in terms of rolling out mass testing, in securing vaccines and also in terms of making improvements to test and trace."
Cabinet Office Minister Michael Gove said there was also a "complete focus in government on making sure we can work with business and work with citizens in order to deliver on the promise of Brexit".
This is much more than a random resignation.
Lee Cain was Boris Johnson's longest serving aide in No 10 and very close to his most senior adviser, Dominic Cummings.
Arguments and rivalry in any Downing Street operation are not unusual.
This feels different though, perhaps the final act of Vote Leave is playing out after months of building tensions.
One insider - who until now has kept their counsel - spoke out in frustration last night, saying: "I just can't describe to you how much of a mess it is."
This is about who is running the country and the prime minister's ability to manage his own operation.
The question now is whether the chaos that has spilled into public spirals into something more serious, or whether it is the chance for a reset the prime minister requires.
Allies of Mr Cain were unhappy about how he had been treated, which prompted initial speculation about Mr Cummings's own future.
Mr Cummings and Mr Cain are long-time colleagues, having worked together on the Leave campaign during the EU referendum.
Mr Cain, who is set to step down next month, will be replaced as the director of communications by James Slack - a former journalist and one of the PM's spokesmen.
Mr Johnson is thought to be looking to fill the post of chief of staff as part of a wider reorganisation, which will also see ex-BBC journalist Allegra Stratton take on a role fronting new daily televised press briefings.
Who is Lee Cain?
- Lee Cain, 39, went to Ormskirk Grammar School in Lancashire and Staffordshire University, before starting a career in journalism in 2006 as the Abbeymead and Abbeydale patch reporter for the Gloucester Citizen
- He worked briefly at the Sun and the Mail on Sunday and then joined the Daily Mirror - where he spent time during the 2010 election campaign following Conservative leader David Cameron dressed as a chicken
- Later, he became a member of the communications team for the Vote Leave campaign, and worked as a special adviser for Boris Johnson at the Foreign Office
- He also worked for Michael Gove and Andrea Leadsom at the Department for Environment, Food and Rural Affairs
In his resignation statement, Mr Cain said it had been a privilege to work for Mr Johnson, but he added: "After careful consideration I have this evening resigned as No 10 director of communications and will leave the post at the end of the year.
In response, Mr Johnson thanked Mr Cain for his "extraordinary service" to him, calling him a "true ally and friend".
But several Conservative MPs have expressed dismay at the wrangling in Downing Street, which comes at a time of growing unease on the government's own benches over its handling of the pandemic - especially the use of lockdown measures.
Charles Walker, the vice chairman of the influential 1922 committee of backbench MPs, told BBC Radio 4's Today programme there has been "unhappiness about the No 10 operation for some time".
He added: "Members of Parliament have felt excluded from the decision-making process, and that's no secret.
"The real opportunity here is for the chief of staff position to be filled by someone who has good links with the Conservative Party and its representation in the House of Commons."
Fellow Tory backbencher Sir Roger Gale said it was "very worrying indeed" that No 10 "consider it proper to devote this amount of energy to internal squabbles" in the midst of a pandemic and Brexit trade negotiations.
He told BBC News: "We really do need people there with their minds on the job. It really is time that Downing Street got in place, what I think is now in common parlance is known as somebody with big boy pants on.
"A prime minister, particularly one facing the difficulties that Mr Johnson is facing, needs heavyweight help."