UKIP's economics spokesman Patrick O'Flynn blew open simmering tensions within the party in an interview with The Times, saying Mr Farage was no longer the "cheerful, ebullient, cheeky, daring" politician of recent times.
Mr O'Flynn said the UKIP leader's behaviour risked the party being seen as an "absolute monarchy" and blamed Mr Farage's "aggressive" and "inexperienced" advisers.
He called for Mr Farage, who lives in Kent, to adopt a "much more consultative and consensual leadership style".
Mr O'Flynn's comments come after Mr Farage was widely mocked for resigning as leader after failing to win the South Thanet seat he stood for in the General Election, only to be reinstated three days later after the party's National Executive Committee rejected his resignation.
Nigel Farage's offer of resignation was rejected by UKIP members because of the success of his election campaign, according to a statement by the Chairman of UKIP has revealed.
As promised Nigel Farage tendered his official resignation as leader of UKIP to the NEC. This offer was unanimously rejected by the NEC members who produced overwhelmingly evidence that the UKIP membership did not want Nigel to go
The NEC also concluded that UKIP's general election campaign had been a great success. We have fought a positive campaign with a very good manifesto and despite relentless, negative attacks and an astonishing last minute swing to the Conservatives over fear of the SNP, that in these circumstances, 4 million votes was an extraordinary achievement. On that basis Mr Farage withdrew his resignation and will remain leader of UKIP. In addition the NEC recognised that the referendum campaign has already begun this week and we need our best team to fight that campaign led by Nigel. He has therefore been persuaded by the NEC to withdraw his resignation and remains leader of UKIP.
Nigel Farage has officially stood down as the leader of the UKIP party.
During his speech at the Botany Bay Hotel in Broadstairs he criticised the first past the post voting system saying it was unfair for smaller parties.
Mr Farage said although today is tinged with sadness he feels happier than he has for years.
Suzanne Evans will be the new leader.
Nigel Farage is likely to step down as leader of Ukip if he loses his seat in South Thanet, creating a "real blow for the party", political journalist Isabel Hardman has told ITV News.
The assistant editor of The Spectator has heard from "a very good source" that the party have not won the constituency in Kent.
Hardman said: "If he doesn't win that seat then he will have to step down as Ukip leader because he said he would. In that case Ukip would be pitched into a leadership battle which would be very difficult for the party because Farage is a magnetic figure who has held the party together.
"Even though he has some very impressive people behind him, they're not quite the same as Nigel Farage - so it would be a real blow for the party."
Earlier, Mr Farage gave aninterview to ITV News in which he attacked the press before walking off.
A senior UKIP source refused to rule out defeat, saying it was still a very tight contest in South Thanet. He said he believed the exit poll putting Ukip on winning two seats was wrong, adding that the Eurosceptic party was poised to come second in a number of constituencies.
In Margate, Al Murray, who is standing in the guise of his patriotic character the Pub Landlord for his newly-formed party, the Free United Kingdom Party (FUKP), arrived at the count in front of a battery of photographers.
Dressed in his trademark burgundy blazer, Oxford-educated Murray spoke about rumours Farage had lost in South Thanet, saying: "Well, then we are all walking with history tonight."
He said he would welcome Mr Farage into his pub if it turns out he has lost, adding: "If he's drowning his sorrows tomorrow, then I will say, 'Oh well, mate, better luck in 2020'."
Nigel Farage said it would be "curtains" for him as UKIP leader if he lost South Thanet. The suggestions at the count are that the Tories have won. If he does stand down as leader, it might not be the end of his career. He's stood down as leader before, then came back. But UKIP would face an uncertain future without him at the helm.
UKIP party worker tells ITV Meridian "it's not looking good" for UKIP candidate Mark Reckless in Rochester and Strood.
UKIP have suspended one their Southeast MEPs tonight. Janice Atkinson who was elected to the European Parliament last year has been accused of 'allegations of a serious financial nature'.
Ms Atkinson was to have been UKIP's candidate for the Folkestone & Hythe seat in May's General Election.
The party gave no further details about the allegations that led to the removal of the party whip.
We are incredibly disappointed with Ms Atkinson, who appears to have exercised extremely poor judgment in acting in a way that the party has never and would never condone.
The party has acted swiftly and immediately and, just as we showed when we suspended another MEP for financial irregularities, we always maintain a zero-tolerance attitude towards acts of this nature.
George Osborne has refused to rule out a deal with Ukip after the general election in the event of a hung parliament.
Nigel Farage has said he would prop up a Tory government if the party agreed to stage a referendum on Britain's membership of the European Union in 2015.
The Chancellor claimed Mr Farage was trying to 'muddy the waters' and claimed the UKIP leader was 'not a credible participant' in the general election.
But pressed to rule out a deal, he replied: 'Even engaging with Nigel Farage on this is giving him credibility where he has no credibility.'
The UKIP leader issued David Cameron with a four-point ultimatum on Britain's position in Europe in an extract of his memoirs published by the Sunday Telegraph.
And he said he would bar EU citizens who do not hold a British passport from voting, even though that would include his German wife, Kirsten, and could lead to a legal challenge.
But the UKIP parliamentary candidate for South Thanet reiterated that his party would not enter a formal coalition with the Tories and he was not interested in a 'ministerial car'.
Mr Farage said: 'I would look to do a deal where we would back key votes for them - such as the budget - but in return for very specific criteria on an EU referendum.'