The singer’s estranged wife invited married Dane Bowers to her mansion in Surrey, Southern England, after he bombarded her with “comforting” text messages in the wake of the pair’s separation.
Katie and Dane who famously starred in a homemade sex tape together drank with a group of friends until the early hours of Tuesday morning.
Peter, 36, is said to have been further angered by the fact his children were asleep in the house during the party, and was also dismayed after 31-year-old Katie banned him from seeing her son Harvey on his seventh birthday yesterday.
A source told Britain’s The Sun newspaper: "To say Peter is angry is an understatement. Quite why he is banned from seeing his children but it's all right for Kate to hold wild parties at the house is beyond him.”
Peter had bought presents including a drum kit for Harvey who is Katie’s son from a previous relationship and was upset when he couldn’t give them to him at his party held at a popular UK theme park.
Another source told Britain’s Daily Star newspaper: “Peter desperately wanted to be with Harvey on his big day. Despite not being his natural father Peter dotes on him - Kate knows this. It’s tearing him apart being away from him.”
Peter was only able to see Harvey for three hours last weekend - the first time he had met with him since his split from Katie two weeks ago - although the Mysterious Girl singer had longer access to his children Junior, three, and 23-month-old Princess Tiaamii.
Dane’s night with Katie known as Jordan ended badly after he was arrested on suspicion of drink-driving.
He and a friend were taken into custody after police discovered a crashed car belonging to Dane’s pal near Katie’s home.
The former Another Level singer who has now been bailed told officers he wasn’t driving at the time of the accident and insisted the vehicle had been stolen.
It has been claimed Dane separated from his wife Chrissy Johnston just days before Katie and Peter announced their split.
Chrissy is quoted by Britain’s Daily Mirror newspaper as saying: “He is no longer in the marital home. I don’t have anything to say about Katie and Dane, except each to their own.”