Bell Pottinger has cut ties with Gupta-owned company Oakbay Investments, the UK-based Financial Times reported.
Bell Pottinger, a leading global financial public relations company with several big names as its clients, said that it was ending the relationship after becoming "the target of a politically driven smear campaign in South Africa over the last few months, with a number of totally false and damaging accusations levelled at it".
According to the Financial Times, Oakbay, the holding company of the Guptas' mining-to-media conglomerate, agreed the termination of the contract just over a week ago.
The resignation comes followed claims in the South African press that Bell Pottinger was stoking racial tensions in media campaigns to support President Jacob Zuma and the Guptas.
Bell Pottinger said in a statement: "It has been alleged that whilst we were contracted to Oakbay we were primarily working for the Gupta family with the full approval and involvement of President Zuma. This is completely not the case."