Lord Keen, the Scottish advocate general and justice minister, has resigned over the Internal Market Bill, which would allow the Government to break international law.
The lawyer was finding it "increasingly difficult" to reconcile Mr Johnson's bill with the law, the BBC reported.
Although his resignation was offered on Wednesday morning, Downing Street took until 5.30pm to confirm it had been accepted.
Asked at Wednesday afternoon's Liaison Committee whether Lord Keen had resigned, Mr Johnson said: "As far as I know, conversations on that matter are still continuing." It was later confimed by No10.
Lord Keen rose to prominence when he defended Mr Johnson in the Supreme Court last year when the triggering of Article 50 was challenged by campaigners.
He became the spokesperson for Ministry of Justice business in the House of Lords in July 2016.
The news comes after Lord Keen said Brandon Lewis, the Northern Ireland Secretary, had misspoken when he said the UK was willing to break international law "in a limited and specific way".
Mr Lewis told MPs the justice minister had been wrong to dispute his statement, which he said had been signed off by the Government's law officers.
Labour said that Lord Keen’s authority was “shot” because of the apparent division between him and other ministers.
Tory backbenchers have already rebelled over the bill, which breaks parts of the Withdrawal Agreement with the European Union signed earlier this year.
Former Cabinet ministers including Theresa May and Sajid Javid have opposed the bill, alongside former attorneys general Geoffrey Cox and Jeremy Wright.
Qualified lawyers in the Commons and Lords are said to be reluctant to support the bill in case it prevents them from practicing law after leaving politics.
Mr Johnson said the bill would ensure the UK's "economic and political integrity".