Ashley has increased his stake from 16 per cent, the department store said this morning, giving him 10.5 per cent of voting rights.
Shares in Debenhams rose 1.2 per cent to 41p in the first minutes of trading after the transaction.
Ashley famously began betting in Debenhams' favour back in 2014, when he converted his investment in Debenhams to a put option, effectively meaning Sports Direct would lose out if the company's share price fell below a certain amount at a specific date. Since then, shares have lost more than 40 per cent of their value.
He also bet on Debenhams' rival, House of Fraser, buying an 11 per cent stake in the company originally owned by Sir Tom Hunter.