Derek Hatton has been suspended by the Labour Party less than 48 hours after he was admitted back into the party.
The ex-deputy leader of Liverpool council's membership was provisionally approved on Monday, more than 30 years after he was expelled from the party.
But senior Labour figures have since complained about the move and comments the ex-Militant man made about Israel.
In a tweet in 2012, he urged "Jewish people with any sense of humanity" to condemn Israel's "ruthless murdering".
A Labour party source said the party was "not aware of this material" when it had provisionally approved Mr Hatton's application to rejoin the party.
And "once this was brought to our attention", Mr Hatton's membership application had been suspended pending a final decision by the party's ruling body, the National Executive Committee.
Mr Hatton was a key figure in Militant, a Trotskyite far-left group that ran Liverpool council in the early 1980s.
He was expelled in 1985 after a high-profile battle with Labour's then leader, Neil Kinnock, who accused him and others of seeking to infiltrate and subvert the party.
It emerged on Monday that his application to rejoin the Liverpool Wavertree branch of the Labour Party had been provisionally approved by a special panel of the party.
But this drew fierce criticism from many leading figures in the party, coming on the same day as seven MPs quit the party in protest at what they said was a culture of anti-Semitism in the party.
Earlier on Wednesday, shadow cabinet member Barry Gardiner told MPs he had lodged a formal complaint about the 2012 tweet and believed action was being taken.
"It was a travesty for the news of his readmission to come to public attention on the day when some members of our party were forced out was appalling," he added.
The party's deputy leader Tom Watson has also written to Labour's general secretary, Jennie Formby, questioning the decision to provisionally readmit Mr Hatton.
Mr Hatton posted the 2012 message during "Operation Pillar of Defence" a week-long offensive by the Israel Defence Forces in Gaza.
According to a UNHCR report, 174 Palestinians were killed during the operation, and hundreds were injured.
At the time, NATO Secretary General Anders Fogh Rasmussen said "of course Israel has the right to self-defence and attacks against Israel must end, but the international community would also expect Israel to show restraint".