The de-facto leader of Scotland's Catholics has warned the Church's credibility and moral authority has been "dealt a serious blow" by the actions of disgraced Keith O'Brien, who faces the real prospect of being stripped of his position as cardinal.

Glasgow Archbishop Philip Tartaglia made the comments at a Lent mass last night as O'Brien edged closer to losing his Red Mitre, the headgear traditionally given to holders of the post.

It follows the priest's admission that his sexual behaviour fell below the standards expected of his office.

Archbishop Tartaglia told worshippers at the city's St Andrew's Cathedral: "Many reproaches have been aimed at the Church and at individuals over this matter. The most stinging charge which has been levelled against us in this matter is hypocrisy, and for obvious reasons I think there is little doubt that the credibility and moral authority of the Catholic Church in Scotland has been dealt a serious blow, and we will need to come to terms with that."

On Sunday, Cardinal O'Brien made the dramatic admission of sexual conduct following complaints of "inappropriate behaviour" from priests dating back to the 1980s, apologised and asked for forgiveness.

Archbishop Tartaglia, who was appointed to the caretaker role at the St Andrew's and Edinburgh Archdiocese following Cardinal O'Brien's forced resignation when the story broke last week, said it would take a long time to "recover these intangible but important realities".

Catholic sources have said the extremely rare move of removing the Red Mitre from Cardinal O'Brien could restore confidence to the shell-shocked church in Scotland, with a new cardinal seen as a clean slate and a fresh start.

It is claimed it would also show to the outside world the church acting decisively on internal problems.

Despite standing down from his role as Archbishop of St Andrews and Edinburgh and stating this week that he would play no further role in the public life of the Church in Scotland, as it stands Cardinal O'Brien remains cardinal until he dies and officially the most senior Catholic cleric in Britain.

Unless stripped of that role, he will retain voting rights until he is 80.

Sources also revealed Cardinal O'Brien came clean so he could "get it all off his chest" and had wanted to make the statement earlier.

Despite claims the cardinal is in hiding in an overseas property belonging to Sir Tom Farmer, the Kwik Fit millionaire and Papal Knight insists he does not know of his whereabouts.

At last night's scheduled mass, the archbishop added: "As for the Church's mission in our country, yes, our credibility and moral authority have been undermined. It will take time, perhaps a long time, to recover these intangible but important realities. But we cannot be defeatist. The answer to this sad episode is not to throw in the towel."

Hugh McLoughlin, a writer and commentator on Catholic affairs, said: "The only real question now is will Cardinal O'Brien resign or will he have his role of cardinal removed. It's an extremely unusual thing to be done and can't be until the new pope is in place. Although he's said he will take no more part in public life, he remains for ever and with conclave voting rights until he's 80.

"If he is resigned, that could leave the door open for Philip Tartaglia."

One Catholic Church source said: "The Vatican could look at what's happening here and say that Scotland has made a right mess of things and won't be getting another Red Hat. Or it might take the view that the church has been reduced to a quivering wreck and needs a Red Hat to prop it up.

"It's not outwith the realms of possibility that he [O'Brien] could be stripped of the role of cardinal."

Another source said: "What people are missing here is that he's still cardinal. He's only resigned as archbishop. Pushing him out means the Vatican doesn't have to wait until O'Brien's 80 or he dies before appointing a replacement."

Cardinal O'Brien would be only the fourth churchman in 200 years to be made a former cardinal. Louis Billot of France in the 1920s was the most recent, due to his connection with extreme right-wing groups.

In the 19th century another resigned to marry so as to allow the continuation of his prominent and heirless family, while another quit to become a Jesuit.

An inquiry in Cardinal O'Brien's conduct will be overseen by Archbishop Luis Francisco Ladaria Ferrer, a Spanish Jesuit, Secretary of the Congregation for the Doctrine of the Faith, and Archbishop Giovanni Angelo Becciu, the Substitute of the Secretariat of State.

They will report to the new pope, who will determine what action to take.