Liam Fox has resigned as UK Defence Secretary over his links with his close friend, lobbyist Adam Werritty.

In a letter to Prime Minister David Cameron, Dr Fox said that he had "mistakenly" allowed the distinction between his personal interest and Government activities to become "blurred".

"I have also repeatedly said that the national interest must always come before personal interest. I now have to hold myself to my own standard," he said.

"I have therefore decided, with great sadness, to resign from my post as Secretary of State for Defence - a position which I have been immensely proud and honoured to have held."

In his response, Mr Cameron paid tribute to the "superb job" which Dr Fox had done at the Ministry of Defence.

"I understand your reasons for deciding to resign as Defence Secretary, although I am very sorry to see you go," he said. "We have worked closely for these last six years, and you have been a key member of my team throughout that time."

The announcement comes after days of damaging speculation over the relationship between Dr Fox and his 33-year-old best man and former flatmate.

Mr Werritty was questioned for a second time on Friday by a senior official from the Cabinet Office as part of the Whitehall investigation headed by Sir Gus O'Donnell.

Shadow defence secretary Jim Murphy said: "This was unavoidable and inevitable. Throughout these events I haven't called for Liam Fox's resignation but just the full truth.

"Governments must have rules and ministers must have standards. Liam Fox fell foul of the standards and he broke the rules. It was clear early on that he had breached the Ministerial Code."