Northern Powerhouse Minister James Wharton has announced his intention to back the Brexit campaign.
The Conservative MP for Stockton South revealed on his Twitter page that he was jumping on the Vote Leave bandwagon.
Business leaders believe a ‘Brexit’ vote would be damaging to the North East economy.
And the North East Chamber of Commerce (NECC) says the majority of its members want Britain to remain part of the European Union.
But Mr Wharton, charged with heading up the Tory Government’s so-called Northern Powerhouse last summer, Tweeted: “I will be voting for Brexit and supporting the excellent Vote Leave campaign.
“We should look to the world, not just the EU.”
The Stronger In Europe campaign, which wants the UK to remain, says the North East had received hundreds of millions of pounds from the European Regional development Fund.
Jessie Joe Jacobs, North East Stronger In field director, said: “Mr Wharton will shower places like Newcastle’s Science Central and Sunderland’s Nissan with praise and claim they are evidence that he is doing an outstanding job.
“But the truth is that Mr Wharton is no champion of this region. The Northern Powerhouse Minister is letting down all of the people who choose to build their future here in the North.”
Simon Henig, chair of the North East Combined Authority, said: “For me – and I believe the majority of businesses – that means staying in the European Union as it is a key trade partner.
“We’re one of the few regions with a positive trading balance – that is in large part to our EU trading partners.
“It is his responsibility as Minister to make absolutely sure he is reflecting those views.”
Foreign Secretary Philip Hammond has said foreign investment in North East manufacturing could dry up if Britain votes to leave the EU.
He said the car industry would be particularly hurt by such a decision. Japanese motor giant Nissan employs 6,000 at its site in Sunderland – the largest plant in the history of the UK car industry.
The Labour MP for Sedgefield, Phil Wilson, has led calls to vote to stay in the EU and has been backed by Hitachi Rail Europe.
He also told the Houses of Parliament in February that 80% of businesses in his Constituency favoured to stay in the EU after he carried out a poll.