McBride, who is thought to be one of only a handful of "Brownites" -- those people the Prime Minister counts among his small band of loyal aides -- is reportedly moving to a less high-profile role and will no longer brief the media.
The demotion comes just two weeks after former JWT and Ofcom boss Stephen Carter, Brown's communications and strategy chief, was sidelined after reportedly becoming frustrated with infighting at Downing Street.
The changes follow a headline-grabbing interview Chancellor Alistair Darling gave to The Guardian in August, whose blunt and revealing content came as a shock to Government insiders.
Elsewhere in the reshuffle one shock move has seen the return of EU trade commissioner Peter Mandelson.
There has been no love lost between Mandelson and Brown after the former backed Tony Blair for the Labour leadership in 1994. His appointment as business secretary with a seat in the House of Lords is seen as a nod by the Prime Minister to put aside personal differences.
Mandelson has global experience in trade and finance, which is considered an essential skill as the Government tackles the current international financial crisis.
United Kingdom
PM spokesman McBride sidelined in re-shuffle
LONDON - Gordon Brown's chief spokesman, Damien McBride, has become the latest casualty of the Government's communications team in today's Cabinet re-shuffle.