Government spokesman Ali al-Dabbagh said the court had agreed to replace Abdullah al-Amiri with a new judge.
Al-Dabagh said: "I can confirm he (al-Amiri) has been removed. The US-backed court could not be immediately reached to confirm this. A US official close to the court said he was unaware of any change.
Al-Amiri said to Saddam last Thursday that he was not a dictator.
The comment which enraged once Saddam opponents and today's rulers of Iraq, came after a Kurdish witness told the court how he had managed to meet the deposed Iraqi president to ask about the whereabouts of family members who he said were killed in the Anfal military campaign of 1987-1988.
Tuesday's hearing session continued to listen to witnesses who told stories of Kurdish villages being bombed with chemical weapons.
The session witnessed an angry exchange between the prosecution and Badie Aref, a defence attorney representing Farhan al-Juburi, a former intelligence officer.
Areff demanded the dismissal of Jaafar al-Mussawi, the chief prosecutor, for using a witness who confessed that he had forged a passport to enter Holland back in early 1990s.
Aref was refering to yesterday's witness Karwan. He based his request that one of the key documents constituting the court's law is a letter sent by Caliph Umar bin al-Khatab to his judge on Basra Abi Musa al-Ashari in 636 AD.
Known as the Omari letter, it states clearly that one of the requirments of a just court is not to accept the testimony of a person who committed fraud or of unknown origin.
Al-Mussawi accused the outspoken Aref of being insulting and unprofessional while the lawyer responded that he would file another complaint against the prosecutor for insulting a defence lawyer.
"The court has decided to warn the lawyer not to insult anyone in the court," Abdullah al-Ameri, the chief judge, said.
Aref has already threatened to sue the prosecutor for presenting a witness on Monday who had changed his name to flee Iraq and therefore could not be trusted.