The New Zealand Council, Labour's governing body, has expelled Gaurav Sharma from the party with immediate effect.
In a statement, Labour Party president Claire Szabó said the council "took this decision because it found Gaurav Sharma had brought the party into disrepute", a breach of the party's constitution.
He had been expelled from the party's caucus in August, meaning he was no longer an MP for Labour, but he remained a member of the wider party.
On the same day, Labour's caucus also voted to refer his conduct to the wider party to assess whether his membership should be removed. The leadership then referred the matter to an investigative panel.
Yesterday, Labour confirmed it had recommended he be expelled after an investigation into his conduct.
Szabó published a summary of the events leading up to the decision, saying Sharma had participated actively in the investigation and provided oral and written accounts of his perspective to the investigating panel as well as the full council.
"When we communicated with Gaurav on Saturday 15 October, he said he had recently experienced a bereavement in his wider whānau - which he had also noted on his Facebook page. On that basis, Gaurav requested extra time to document his perspective on our investigation," she said.
"We agreed to his request on compassionate grounds, and gave him an additional opportunity to present any documentation he wished. That window closed yesterday, and we received no further documentation from Gaurav.
"New Zealand Council met this morning and made the decisions outlined above. Gaurav's expulsion is immediate."
Sharma resigned as an MP this week, forcing a by-election in the Hamilton West electorate.
Prime Minister Jacinda Ardern confirmed the by-election would be held on 10 December.
In a lengthy social media post announcing his resignation, he said it was to pre-empt Labour using the waka-jumping legislation against him.
He claimed to have been told by a reliable source within Labour's NZ Council there was a plan to have him removed in the six months before next year's general election, which would mean there was no requirement to hold a by-election in the seat.
Prime minister and Labour leader Jacinda Ardern and Labour President Claire Szabo have both rejected the claim.