No reason was given for the sacking of Intelligence Minister Gholam Hossein Mohseni Ejeie.
The president is due to announce a new cabinet after he is sworn in for a second term in 10 days' time, following a disputed election victory.
Amid the turmoil, Mr Ahmadinejad's office also denied reports that three other ministers were sacked.
One of those reported dismissed, Culture and Islamic Guidance Minister Mohammad Hossein Saffar Harandi, said he was resigning because of the confused reports.
"Unfortunately due to the recent events which shows the esteemed government's weakness, I will no longer consider myself the minister of culture and will not show up at the ministry as of tomorrow," he said in a letter of resignation carried by the Fars news agency.
Mr Ahmadinejad's decision to give up on the appointment of his First Vice-President, Esfandiar Rahim Mashaie, was prompted by the publication of a letter from Supreme Leader Ayatollah Ali Khamenei telling him his choice was unacceptable.
On Saturday, however, Mr Ahmadinejad appointed Mr Mashaie as his chief of staff, setting up another potential confrontation with conservatives.
Mr Mashaie had angered hardliners last year by saying Iranians and Israelis were friends, BBC reported.