In an embarrassing climbdown, Deputy First Minister Nicola Sturgeon admitted the Government has not taken legal advice on an independent Scotland's membership of the EU.
Mr Salmond angrily rejected claims by a Labour MSP that he had lied, after he apparently insisted during a TV interview in March that such advice had been sought.
He told the Scottish Parliament in an emergency statement yesterday that he had been speaking in general terms and said his remarks referred to legal advice about previously published Government documents and publications. He also demanded an apology from his accusers, though none was forthcoming.
It came after Ms Sturgeon dropped costly Government legal action designed to keep the existence of any such advice secret and promised to consult Government lawyers in future.
The SNP was further rocked by the resignation of MSPs John Finnie and Jean Urquhart over the party's decision to abandon its opposition to Nato.
The Government also faced growing criticism over its threat to disregard the politically impartial Electoral Commission watchdog when it comes to draw up rules for the independence referendum.
Ministers were accused of ignoring the public's views on the referendum as they published their long-awaited consultation on the vote, a week after agreeing the format with the UK Government.
In a caustic echo of Mr Salmond's "Scolympians" description of Scottish Olympians, Labour MSP Richard Baker said the Nationalists had been plunged into a "Scomnishambles".
During a statement to MSPs on the referendum process, Ms Sturgeon confirmed ministers had no official legal advice on an independent Scotland's membership of the EU.
It followed a 17-month Freedom of Information battle begun by Labour MEP Catherine Stihler. She had asked whether Government lawyers believed an independent Scotland would automatically become an EU member or would have to apply to join.
Ministers, who have always insisted membership would be automatic and that Scotland would not have to join the euro single currency, refused to say. In July, Scotland's Information Commissioner, Rosemary Agnew, ordered them to reveal whether any advice existed.
The Court of Session was due to rule on the Government's appeal but yesterday Ms Sturgeon admitted ministers had "not sought specific legal advice". She said there was "now no need" for the Government to continue its appeal, which to date has cost £12,000 of taxpayers' money.
Mr Salmond was asked by Andrew Neil, presenter of the BBC's Sunday Politics
show in March: "Have you sought advice from your own Scottish law officers on this matter?" He replied: "We have, yes, in terms of the debate."
Alistair Darling, leader of the pro-UK Better Together campaign, said: "This strikes at the heart of Alex Salmond's credibility.
"In March he said he had legal advice on this critically important issue, today his deputy has had to admit that no such advice has been received. It looks like Alex Salmond has embarked on a costly legal battle to conceal the fact that there never was any legal advice."
Labour MSP Paul Martin said: "It appears the First Minister is a liar and used taxpayers' money to try to cover up his lies."
Scottish Conservative leader Ruth Davidson said: "The Scottish Government spent thousands keeping this information a secret, only to then admit what everyone suspected – no such advice has ever been taken."
Meanwhile, the Scottish Government's consultation found 64% of people who took part "broadly agreed" with the wording of the proposed question: Do you agree that Scotland should become an independent country?