In a humiliating blow to the hard Left leader, 64 Remainer Labour MPs defied his demands that Labour backed leaving the hated customs union which will free up Britain to create its own free trade deals.
The massive rebellion came just days after Mr Corbyn had claimed that he is ready to be Prime Minister arguing that Labour is the only party which can provide clarity on Brexit.
And it completely dwarfs the rebellion of just 11 Tory MPs suffered by Theresa May last week.
The Remainer Labour MPs backed an amendment by Nottingham East MP Chris Leslie to keep Britain in the customs union and effectively tie Britain to Brussels rule.
The revolt also highlights confusion in the Labour ranks over Brexit with the party holding at least a dozen contradictory positions on the policy since the election in June.
In the last few days Labour deputy leader Tom Watson has refused to rule out holding a second EU referendum just after shadow Home Secretary Diane Abbott said one should not happen.
Earlier this year around 50 MPs also defied the leadership to support staying in the EU single market.
Following the vote on the customs union late on Wednesday night, Mr Leslie said: “We’ve reached a point where Labour needs to be strongly and clearly pro single market and customs union and the time for politicking and legalistic obfuscation has passed.
“It was hard for 64 Labour MPs to break the whip but sometimes it’s necessary to put country ahead of party politics.”
The result drew ridicule from Tory MPs who said that Labour cannot work out whether to keep to its manifesto commitment to honour the EU referendum result or not.
Leading Tory backbencher Jacob Rees Mogg said: “The Labour Party is deeply split between those who are trying to keep the UK in the EU against the wishes of the electorate and those who respect the result.
“This leaves Mr Corbyn as piggy in the middle”.
Monmouth Tory MP David Davies said: “The Labour Party doesn’t know whether it is coming or going.
“It is obvious Jeremy Corbyn can’t be Prime Minister when he can’t even get his MPs to vote with him.
“Thank goodness he isn’t and we in the Conservative Party are going to deliver Brexit.”