Neil McEvoy has been permanently expelled from the Plaid Cymru assembly group.
The South Wales Central AM was suspended last year amid a row over his stance on right-to-buy.
A spokeswoman said Mr McEvoy was now being expelled due to an "irrevocable breakdown of trust".
Mr McEvoy said he had been "forced out" of the group and would continue to represent the people who elected him.
The decision follows claims Mr McEvoy made about his suspension and others in the group, which were dubbed "inaccurate" by Plaid.
Earlier on Tuesday Mr McEvoy said he would appeal his suspension at a meeting of the party's national executive committee in March.
The group has referred the matter to the party's ruling body, with a request for further disciplinary action.
A Plaid Cymru assembly group spokeswoman said the decision to expel Mr McEvoy was unanimous.
"His ongoing behaviour has left assembly member colleagues feeling undermined and demoralised," she said.
"Plaid Cymru representatives' loyalty first and foremost is to the people of Wales. We will not be distracted from our work of serving them to the best of our ability by such deliberate and sustained sabotage."
The spokeswoman accused Mr McEvoy of having made "inaccurate claims about the reasons for his suspension from the assembly group" in a statement he issued earlier on Tuesday.
The comment is understood to refer to a claim by Mr McEvoy that he was suspended "for questioning the merits of ending the right to buy council houses".
Plaid Cymru has supported Welsh Government efforts to axe the Thatcher-era policy.
Comments made by Mr McEvoy on the issue caused a party row last summer and led to his suspension - his second of 2017.
A party source said at the time that Mr McEvoy "broke the trust" of the group in the way he had objected to the policy.
"As was stated at the time, Neil McEvoy was suspended for breaching standing orders and the Group's Code of Conduct through unacceptable behaviour," the spokeswoman said.
She also accused Mr McEvoy of smearing "the reputation of colleagues" over comments he made at a press conference on Tuesday.
Mr McEvoy said it seemed there was one rule for one AM and another for others in the group, and that other Plaid AMs had questioned party policy in the past or flown the flag of other parties without action taken.
Such comments "underline the insincerity of Mr McEvoy's alleged desire to return to the group", the spokeswoman said, adding that the chair of the ruling national executive committee, Alun Ffred Jones, has been notified of the group decision.
I'm currently hosting a showing of the brilliant documentary #injustice (the irony) I haven't seen any email and will comment when I can.— Neil McEvoy AM (@neiljmcevoy) January 16, 2018
"There's a request for the NEC to look at further disciplinary steps," she said.
Mr McEvoy remains a Plaid Cymru party member - although the party has said he is subject to an investigation about complaints about his behaviour.
The decision means he will continue to effectively be an independent AM within the assembly.
Plaid Cymru has also passed on separate complaints made against AM Neil McEvoy about his behaviour to the assembly standards commissioner.
In response to his expulsion Mr McEvoy said he had "never been interested in fighting with my own colleagues".
He added: "I'll keep representing those people who have been left behind and given up on politicians.
"We're not all the same. There are people who really care. I grew up on an estate in Cardiff and I made it to the assembly. I hope that inspires people to know that anything is possible.
"Politics is about ideas but it's also about personalities. We don't always get along but there is always the bigger picture."