Bryan Denson, who led the opposition Tory group on Wakefield Council between 2007 and 2009, was one of more than 20 individuals called out by the campaign group Hope Not Hate in an article published on Monday.
According to the group, Mr Denson shared a Facebook post by the Kent branch of the English Democrats in 2015, suggesting David Cameron was wrong to call Islam "a religion of peace".
The post featured images of the 9/11 terrorist attacks and Lee Rigby, the soldier who was murdered in Woolwich by a pair of extremists in 2013.
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The BBC was told on Monday afternoon that the Conservative Party had suspended those named in the dossier who were party members.
The Local Democracy Reporting Service has tried to contact Mr Denson for comment, but he is yet to respond.
However, it's been suggested he left the Tory Party for UKIP after standing down as a councillor for the Wakefield Rural ward in 2011.
Current Conservative group leader, Nadeem Ahmed, condemned Mr Denson's actions.
He said: "Bryan should have known better.
"I've not spoken to him for a long time so I don't know who he's been hanging round with to influence his thinking in that way.
"I think there's people of a certain profile who are quite new to social media and who don't realise that everything they say is out there straight away.
"People may have certain views that they've hidden for a long time and then they think they can express it on social media."
Coun Ahmed said the issue showed some people willingly conflate freedom of speech with racist and bigoted views.
He added: "I think there's an element of people in society who think, "Why can't we say that stuff?"
"I've had conversations with people who think like that.
"I don't want to ban freedom of speech, but expressing racist and sexist views isn't freedom of speech."
Others named and shamed in the dossier included a mixture of Tory activists and councillors from across the country.
In a tweet accompanying its findings, Hope Not Hate said: "The Conservative Party needs to take much more seriously its obligation to Muslim members, and to the wider community.
"That means tougher sanctions, and more transparency about its processes and decisions.
"Time and again, Conservative activists have been suspended for Islamophobia. Time and again they have been allowed back without apology or serious disciplinary action. The lack of transparency means we rarely see what has been decided, or why."
In response a Tory spokesman told the BBC: "All those found to be party members have been suspended immediately, pending investigation.
"The swift action we take on not just anti-Muslim discrimination, but discrimination of any kind is testament to the seriousness with which we take such issues."
Local Democracy Reporting Service