Executive members of Palang Pracharath agreed in a meeting on Wednesday to oust secretary-general Thamanat Prompow and 20 other MPs under his control from the ruling party.
The executives made the bold decision on the grounds that the presence of Capt Thamanat and his faction had created rifts that damaged the party.
The move came after Palang Pracharath lost the by-elections on Jan 16 in Chumphon and Songkhla provinces to the coalition Democrat Party, despite Capt Thamanat's efforts to try to take his candidates to Parliament.
His political campaign in Hat Yai district of Songkhla for Anukul Prueksanusak ahead of the by-election day angered several members of Palang Pracharath, as he spoke on stage urging southern voters to send a rich man to Parliament.
His rivals in Palang Pracharath said the remarks had backfired on the party and had influenced voters to cast their ballots for the Democrats.
Palang Pracharath will hold a press conference on Thursday to explain the decision to part ways with the secretary-general.
Capt Thamanat is known to be close to party leader and Deputy Prime Minister Prawit Wongsuwon.
Capt Thamanat and his faction have to find a new party within 30 days to keep their MP status.