Thelma Walker, who was MP for Colne Valley until last year’s General Election, resigned from the party last night, she announced on Twitter.
Ms Walker, who was MP for the West Yorkshire constituency from 2017 to 2019 and served as Parliamentary Private Secretary to then-Shadow Chancellor John McDonnell, said: “Tonight I attended my branch meeting and resigned my membership of the Labour Party.
“It was a privilege to serve as Labour MP for Colne Valley, to be PPS to John McDonnell, and to work with Jeremy Corbyn as Labour leader.
“I will continue to work for the many, not the few.”
It comes after Labour leader Sir Keir Starmer’s decision to block Jeremy Corbyn from sitting as a Labour MP despite his readmission as a party member.
Sir Keir said on Wednesday morning that he would not restore the whip, meaning Mr Corbyn will continue to sit as an independent MP and will not be part of the Parliamentary Labour Party (PLP).
However former Shadow Home Secretary Diane Abbott, an ally of Mr Corbyn, questioned whether Sir Keir would ever have been elected leader if members knew how he would act against his predecessor.
She said excluding Mr Corbyn was “wrong” and Sir Keir’s actions were “no way to unite the party”.
While Mr McDonnell said: “When Thelma Walker, one of Labour’s loyalest of the loyal, feels so strongly that she resigns then it’s time voices like hers are listened to.
“People with lifetimes of service and support for the party are leaving because of their sense of injustice. This needs sorting and fast.”
But prominent Jewish Labour MP Dame Margaret Hodge suggested she would have left the party if Mr Corbyn had been readmitted to the PLP and Sir Keir’s actions “did a lot to restore his credibility”.
Dame Margaret told the BBC’s Today programme: “It was completely wrong for the party to let Corbyn back in under a process that was shown, again, to be broken and politically corrupted, and I think it was completely right of Keir Starmer to deny Jeremy Corbyn the whip.”
Mr Corbyn was reinstated as a Labour member by the National Executive Committee following a meeting of a disciplinary panel, three weeks after he was suspended over his response to a scathing Equality and Human Rights Commission (EHRC) report.
The equalities watchdog has ordered Labour to establish an independent process to deal with anti-Semitism issues, rather than the system which dealt with Mr Corbyn’s case.
Shadow Chancellor Anneliese Dodds told Today it was “a matter of huge regret”, adding: “We have to sort out that system, it cannot remain as a politicised system.”
Asked whether there could be a way to readmit Mr Corbyn to the PLP, she said Sir Keir had promised to keep the position “under review”.
Ms Abbott was one of more than 30 MPs and peers in the left-wing Socialist Campaign Group calling for Mr Corbyn to have the whip restored.
The group - which includes Yorkshire MPs Richard Burgon, Olivia Blake, Imran Hussain, Rachael Maskell, and Jon Trickett - said: “The decision not to restore the whip to Jeremy Corbyn is wrong and damaging to the Labour Party.”
Len McCluskey, general secretary of Unite – Labour’s biggest donor – said the refusal to restore the whip to Mr Corbyn was “vindictive and vengeful” as he urged Sir Keir to “pull back from the brink”.
He accused Sir Keir of acting in “bad faith” and reports have suggested that allies of Mr Corbyn believed a deal had been struck with this successor’s office to restore his standing in the party – a claim denied by the leadership.