Lord Ahmed of Rotherham said the second warning was issued in an Arab newspaper last week by Sheikh Omar Bakri Muhammad, who heads the London-based group al-Muhajiroun.
The Labour peer – one of the first to be appointed by Prime Minister Tony Blair and an outspoken critic of fundamentalism – had already received death threats weeks earlier from the Muslim militants.
It is understood members of al-Muhajiroun ordered the death threat because it was felt he had allied himself with non-Muslims.
Lord Ahmed has openly called for Islamic militants, such as Abu Hamza and Omar Bakri, to be kicked out of the UK and has also been an outspoken critic of the teaching in some mosques around the country.
He called for imams to be tested in English language and culture and said many clerics were preaching extremism.
Lord Ahmed shrugged off the first threat and yesterday stood firm, insisting he would not allow either fatwa to silence him despite his concerns for his family.
"I'm determined to speak out for the masses and I'm determined to portray the true face of Islam, which is of peace, co-existence and reaching out to other communities," he said.
"I do fear for my family and my children, but I think my life is less important than the message I want to get across.
"I'm determined to see that the majority of British Muslims are heard and these extremists are silenced. We must not allow these fanatics to silence the voices of the majority."
The first fatwa against Lord Ahmed is understood to have come at an al-Muhajiroun meeting after he was declared guilty of apostasy, abandoning his faith, a crime which is punishable by death.
The radical group openly campaigns for extremism and has been accused of recruiting Britons to terrorist training camps.
Lord Ahmed said: "Omar Bakri has no legal, religious or moral right to issue fatwa in this country. Somebody who has as extreme views as he does has no place in our society and should be alienated."
Following the threats, Lord Ahmed has spoken to anti-terrorist police to discuss stepping up his security but said he would not be driven into hiding.
He said Scotland Yard officers had made security recommendations but he had rejected any extra security which taxpayers would have to foot the bill for.
Lord Ahmed said he had been against the war in Iraq, but said extremists should not try to divide those who shared his views on the grounds of religion.
"Of course I was against the war, but then so were the majority of Christians. Those who try to divide us have no place in society."
Lord Ahmed added he rejected wholesale any claim that he had turned his back on his faith.
"A proud Muslim can be a proud Yorkshireman too. There is nothing contradictory about that – to be passionate about my religion and to also enjoy my fish and chips and the straight talking of the people of Rotherham."
n United Nations Secretary-General Kofi Annan said yesterday that the UN was taking seriously a death threat against him and other officials made in an audio tape attributed to Osama bin Laden.
The UN headquarters said it was taking steps to "enhance the security of the Secretary-General" after the 20-minute recording was posted on websites offering rewards in gold for the killing of top US and UN officials in Iraq.