According to Die Zeit newspaper, Christian Lueth was sacked by senior party ally Alexander Gauland following an internal review over recent comments by the spokesman.
Lueth had allegedly “repeatedly described himself as a fascist and referred to his grandfather's Aryan lineage”, the paper wrote in its online edition.
His grandfather was a submarine commander during World War II and received an Iron Cross for his services from Nazi leader Adolf Hitler, the newspaper reported.
He “was fired on Friday with immediate effect”, Die Zeit wrote, citing sources within the anti-Islam and anti-immigration party.
The AfD did not immediately respond to a request for comment.
Lueth, 43, had been with the party since it its early days as an anti-euro outfit in 2013 and cultivated close ties to top party figures like Gauland and Tino Chrupalla.
Lueth started out as a press spokesman for the AfD before becoming the spokesman of its parliamentary group when the party entered the national Bundestag in 2017.
Die Zeit said Chrupalla had confirmed Lueth's dismissal but declined to comment on the reason.
The weekly newspaper described the sacking as “surprising”.
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The AfD is no stranger to controversy and has frequently come under fire for expressing anti-foreigner sentiment and railing against Germany's culture of remembrance for Nazi crimes.
Gauland once dismissed the Nazi dictatorship as a “speck of bird shit” in German history.
Following news of Lueth's ousting, some commentators were quick to point out that a German court last year ruled that another senior party member, Bjoern Hoecke, could justifiably be called a fascist — yet remains the AfD's leader in the eastern state of Thuringia.
“Why would the media think he was fired because of 'allegations of fascism'?, tweeted Ruprecht Polenz, a former secretary general of Chancellor Angela Merkel's centre-right CDU party.
“Wouldn't the AfD then also have to kick out somebody else?” he added.
The AfD's popularity surged after it capitalised on a wave of anger over an influx of asylum seekers in 2015.
But support for the party has waned somewhat in recent months after it was blamed for fuelling a spate of far-right attacks.
The AfD has also been less visible lately, as the coronavirus pandemic puts the spotlight on Germany's ruling parties.