The designer, famed for his chameleon style

Fashion house Christian Dior SA suspended creative director John Galliano today after he was detained and accused of an anti-Semitic insult, in a bombshell development days before Paris catwalks heat up for fashion week.

Dior said in a statement it suspended Galliano pending an investigation into an incident in a Paris restaurant last night.

Paris prosecutors said a couple in the restaurant accused Galliano of making anti-Semitic insults. A police official said Galliano also exchanged slaps with the couple.

The British designer was questioned and released after the incident. Both officials, who spoke on condition of anonymity because the investigation is ongoing, say Galliano's blood alcohol levels were high.

"The House of Dior confirms, with the greatest firmness, its policy of zero tolerance for any anti-Semitic or racist comments," Sidney Toledano, CEO of Dior Couture, said in the statement.

Galliano's suspension is a big blow at a bad moment for one of world fashion's most storied companies. Dior would not comment on whether it would present its collection as planned at the fall-winter 2011-2012 ready-to-wear shows that start up in Paris next week.

Galliano's French lawyer was reported as saying that his client denied making anti-Semitic remarks.

Galliano's flamboyant personality and over-the-top creations have become synonymous with Dior over his 14-year tenure. He revamped and modernized the image of the house and sent out intricate, imaginative collections themed around everything from ancient Egypt to Masai tribesmen and 18th century equestrians.

Known for his chameleon style, he thrills fashion insiders at the end of each runway show by taking a puffed-out rooster strut, always in an outrageous costume.

Dior, owned by luxury group LVMH Moet Hennessy Louis Vuitton, would not comment on whether it would still present its collection at this season's ready-to-wear shows, which are expected to take Paris by storm next week.

Announcing Galliano's suspension, Dior Couture chief executive Sidney Toledano said: "The House of Dior confirms, unequivocally, its policy of zero tolerance for any anti-Semitic or racist comments."

The move will come as a big blow for Dior which has relied upon Galliano's inspiration and extravagant creations to re-shape its image.

The designer, famed for his chameleon style, has been widely credited with revamping and modernising the house with his intricate and varied collections which draw widespread acclaim among the fashion elites.

His own appearances on the catwalk, usually made in an outrageous costume at the end of each show, are greeted with delight.