For generations it has been accepted that John Lennon's wish to place Jesus Christ, Adolf Hitler and Mahatma Gandhi on the cover was ruled out because of the upset their inclusion would cause. But now the artist who created it, Sir Peter Blake, has revealed for the first time that Hitler did make the final line-up for the sleeve, but was simply obscured by the Fab Four.

Sir Peter said: "Yes he is on there - you just can't see him."

The record, bought by around 32 million people since it was released in " the summer of love", features a crowd of some of the most famous faces of the previous century, including Stan Laurel, Bob Dylan and Marlon Brando.

Each of the band members chose their favourites, with George Harrison opting for a number of Indian gurus to reflect his spiritual leanings, and Ringo Starr happy to go along with the others' choices.

Lennon's list, thought to be half-joking, included Jesus, Hitler and Gandhi. However, following his infamous comment the previous year, 1966, that the band was "bigger than Jesus", it was thought best not to even commission a cardboard cut-out of Christ for the collage. Gandhi was included but edited from the final image, and Hitler has long been thought to have been pushed to the edge of the studio on the grounds of taste.

But Sir Peter said: "Hitler and Jesus were the controversial ones, and after what John said about Jesus we decided not to go ahead with him - but we did make up the image of Hitler. If you look at photographs of the out-takes, you can see the Hitler image in the studio. With the crowd behind there was an element of chance about who you can and cannot see, and we weren't quite sure who would be covered in the final shot. Hitler was in fact covered up behind the band."

Sir Peter has just healed a rift with the Beatles' company Apple that had threatened a planned retrospective of all the record covers he has designed. They include albums by Paul Weller, Eric Clapton and Oasis.

Initially, Apple had refused to allow him to reproduce the Sgt Pepper image - he signed away the copyright when he was paid £200 for his work on the sleeve - but the firm has now relented. "I think they simply changed their minds. It does seem we are on a happier footing now," Sir Peter said.