The Conservative Party has been accused of “institutional” Islamophobia and “turning a blind eye” to prejudice.
Baroness Warsi is angry about the case of a Tory council candidate who had been reinstated after apologising for what she said were “vile” comments.
Peter Lamb, who had been due to stand for election in Harlow, has now quit the party, following the outcry.
Baroness Warsi told Politics Home there were many other examples of the party failing to take action.
She has written to the party’s chief executive Sir Mick Davis urging him to “show leadership” on the issue, because leader Theresa May and party chairman Brandon Lewis had not.
She said Sir Mick had a “long history of fighting bigotry” and was “uniquely placed to understand consequences of unchecked hate”.
As chairman of the Jewish Leadership Council, he had “rightly led the fight against anti-Semitism within the Labour Party”, she added.
Peter Lamb was due to stand in the Staple Tye ward, in Harlow, Essex, in May’s local elections and had previously stood in the Toddbrook ward.
He was disciplined by the party after comments he had made on social media came to light.
In 2015, he tweeted: “Islam like alcoholism [sic]. The first step to recovery is admit you have a problem.”
Later in the same year, he tweeted “Turkey buys oil from ISIS. Muslims sticking together,” adding: “Do they want us to call ISIS Daesh now so that we don’t associate them with Islam?”
‘Party in denial’
On Saturday, Mr Lamb apologised for the remarks.
“Some time ago I tweeted a comment about Islam, The tweet was aimed at the Extremists that have hijacked Islam and are cowardly hiding behind the religion, I would like to apologise to those who follow the religion peacefully and are contributing to the diversity of the UK,” he said in a tweet.
He was reinstated as a candidate but local party sources said he had quit the party earlier on Tuesday, following the row about his comments.
Baroness Warsi was the first women of the Muslim faith to become a member of the cabinet in the UK, under then Tory leader David Cameron, and has frequently spoken out about anti-Muslim prejudice in the party.
In an interview with Politics Home, she said the Peter Lamb incident showed Islamophobia had become “institutional” in the Conservative Party.
“It is appalling that a man suspended for Islamophobic comments just two years ago has been re-admitted and allowed to stand as a candidate,” she said.
“Giving him what his local party chair calls a ‘slap on the wrist’ shows again this is not an issue confined to individuals but one that has gripped in the institution.”
She added: “I have been raising these issues for over three years and yet still the party fails to act. We now have daily examples of the most vile racist and Islamophobic comments from both elected representatives and members and still the Party remains in denial.
“And whilst the comments and actions of individuals are disturbing what’s even more hurtful and worrying is my Party’s complete lack of political will to even acknowledge the extent of the challenge we face. This rot is institutional and it’s why I have been urging the prime minister and others to hold an Independent Inquiry.”
When tackled last week about allegations of Islamophobia in the Tory ranks, Conservative MP Henry Smith told the BBC’s Politics Live said he had “never come across” it.