The king, who gave up the throne in June 2014 in favour of his son Felipe, was in a romantic relationship with Corinna zu Sayn-Wittgenstein and "for a long time" thought of divorcing his wife Sofia, author Ana Romero said at the book's presentation in Madrid on Wednesday.
"They were a couple pure and simple," she said, before adding that members of the former king's entourage had discouraged him from getting a divorce.
"What do you see (in the book)? Well, the double life which Juan Carlos led during a long time, a double life which obviously has not gone well."
Romero, a former royal correspondent for the El Mundo daily, said the pair met in 2004. She told journalists at the book launch that reports suggest their illicit relationship ended shortly after his abdication.
Her 424-page book, called "Final de Partida" or "End Game", focuses on the last four years of Juan Carlos's reign when his popularity slumped. It is based on interviews with about around a hundred anonymous sources.
The first print run of 25,000 copies nearly sold out Wednesday less than 24 hours since the book hit stores and its publishers have already ordered a second print run.
"It is a chronicle of the end of an era, when Spaniards turned their backs on Juan Carlos," said Romero.
The 77-year-old former king's friendship with Sayn-Wittgenstein, who is divorced from the German prince whose name she bears, emerged in 2012 when Juan Carlos was flown home from Botswana on a private jet after suffering an injury while on an expensive elephant-hunting holiday.
The German woman, who is 28 years younger than Juan Carlos, was among those accompanying the monarch on the trip, which sparked outrage at a time when Spain was grappling with record unemployment and risked needing an international bailout.
Juan Carlos, who won respect for his role in guiding Spain's transition to democracy after the death of longtime dictator General Francisco Franco in 1975, made an unprecedented apology for his behaviour but his popularity took a serious hit.
Romero said the uproar over the hunting trip, combined with a string of health problems and a corruption scandal implicating his youngest daughter Cristina, created the "perfect storm" which pushed Juan Carlos to abdicate.