Derek Hatton, who was expelled from Labour in the 1980s for being a member of Trotskyist group Militant, has withdrawn his application to re-join Labour, a party spokesman has confirmed.
The former Liverpool City Council deputy leader, 71, submitted a membership application in September, which was officially approved in February.
But he was suspended less than 48 hours after re-joining when people drew attention to a tweet he wrote in 2012 that urged "Jewish people with any sense of humanity" to condemn Israel's "ruthless murdering".
A Labour spokesman said: "Derek Hatton has withdrawn his membership application and is therefore not a member of the Labour Party."
His re-joining the party caused wide spread condemnation in February and coincided with the resignation of seven sitting MPs from the party, who cited antisemitism among reasons for their departures.
Labour's ruling National Executive Committee had been due to review Mr Hatton's application on Tuesday.
Mr Hatton was expelled in 1986 for belonging to Militant – a “party within a party”, which was found to have contravened Labour’s constitution groups with their own "Programme, Principles and Policy for separate and distinctive propaganda".
Under the leadership of Neil Kinnock, Labour’s National Executive Committee voted to expel him by 12 votes to six.