Lord Falconer, the former Lord Chancellor, said the conflict was perceived as a mistake and had damaged Labour.
Interviewed for a BBC Scotland documentary on his party’s plight, he said the basis of Britain’s intervention was mistaken.
He told the programme, to be broadcast tonight (Mon), “We didn’t find weapons of mass destruction there and that was the basis by which we went in.
“So on that basis, we weren’t right to go in.”
The failure of coalition forces to find weapons of mass destruction in Saddam Hussein’s arsenal, the heavy loss of life and continued instability in the country caused growing anger over Britain’s role in the war.
It continues to dog Labour eight years after Mr Blair left office.
Lord Faulkner denied it had damaged Labour more in Scotland than elsewhere in the UK despite the SNP, which opposed the conflict, using it repeatedly as an issue to attack their main opponents.
In a sign of the party’s difficulties, Scottish Labour leadership frontrunner Kezia Dugdale yesterday warned the party faced another “storm” in next year’s Holyrood election, after losing 40 MPs last month.
She told Sky News’s Murnaghan programme she was asking for party supporters to back her “for the short, the medium and the long term” in the leadership election due to be decided in August.
Lord Falconer, a close confidant of Mr Blair, told the BBC: “I think the Iraq war damaged Labour everywhere, and I think that the Iraq war is perceived to be a mistake.
“By Labour, by Tony Blair.
“That damaged Labour right throughout Scotland and England, but I’m not sure that it necessarily damaged Labour more in Scotland than it did in England.”
A so-called “dodgy dossier” produced before the invasion claimed it was “beyond doubt” that dictator Saddam Hussein had continued to produce chemical and biological weapons and was making efforts to develop nuclear weapons.
It also claimed Iraq could deploy biological weapons within 45 minutes of an order to do so.
No weapons of mass destruction were discovered.
Speaking on Sky News, Ms Dugdale said Labour’s decision to campaign alongside the Conservatives during the independence referendum had also damaged the party, though she believed it was “the right thing to do for Scotland” to secure a No vote.
Accepting Scottish Labour faces another tough election next May, she said: “Well our problems didn’t happen overnight and they won’t be fixed overnight either so when I put my name forward for the leadership of my party I asked my colleagues to back me for the short, the medium and the long term.”
She said fellow parliamentarians supporting her bid for the leadership
“understand that this is a long term problem and that we need to fix it in a whole manner of ways”.
She added: “There is a huge amount of change that we need to do within the Scottish Labour party and in terms of speaking to the country ahead so I said yesterday in my campaign launch that it is possible that there is another storm coming for the Scottish Labour party.
“We need to understand the force of that but that doesn’t mean in any way that I have given up on next year’s election.”
Ms Dugdale and her opponent, Eastwood MSP Ken Macintosh, will face each other in the first of four election hustings tonight.
Mr Macintosh will use the Edinburgh event to call for councils to be handed back control over local taxes.
The council tax freeze imposed by the SNP in 2007 has made it all but impossible for local authorities to increase bills.
Speaking ahead of the gathering he said: “John Swinney and Nicola Sturgeon claim the council tax freeze is popular among voters and they may be right, but bribing people to make them like you is not a responsible way to run a government.” ………………’