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Rishi Sunak is taking no action against Tory MP Mark Spencer, after an inquiry failed to determine whether he had told a colleague her Muslim faith was a factor in her sacking.
Nus Ghani claimed she was told her "Muslimness was raised as an issue" when she lost her job in February 2020.
Mr Spencer identified himself as the person Ms Ghani was referring to, but denied making the comments.
A probe said he had not broken ministerial rules.
The investigation, by Mr Sunak's ethic chief Sir Laurie Magnus, said the pair had "differing accounts" of what he had told her in meetings.
It added that advisers who were present at the time of Ms Ghani's sacking said they did not hear conversations in which her faith was discussed.
In a written response, the prime minister said: "In the absence of clear evidence, it would not be right to take further action."