King Vajiralongkorn, 66, issued his message late on Friday, saying his elder sister's candidacy was "inappropriate" and it was against the spirit of the constitution for royalty to be involved in politics.
The party's announcement effectively blocking Ubolratana's candidacy came after an extraordinary rebuke by her brother King Maha Vajiralongkorn, and removes a hurdle for the ruling junta to hold onto power after the March 24 vote - the first since a 2014 coup.
As of early Saturday morning, she had not withdrawn her candidacy, nor had Thailand's Election Commission officially disqualified her.
The party falls under the tutelage of Thaksin, a billionaire self-exiled former premier, who stands at the heart of Thailand's bitter political schism - loathed by the army and Bangkok elite, yet adored by the rural poor for health, welfare and education schemes.
The Thai Raksa Chart Party has cancelled plans today to launch their election campaign in Bangkok's China Town.
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Ubolratana's registration as a candidate was a stunning move, not only because it would have broken a taboo on a senior royal running for public office, but also because it would have allied her with the Thai Raksa Chart Party, considered by many royalists to be unsympathetic to the monarchy.
Later on Saturday, the party that put forward the nomination of Princess Ubolratana Rajakanya Sirivadhana Varnavadi said it would respect the king's statement and would "follow the rules and laws of the election commission, and stay respectful of the traditions and norms in Thailand". She is given the title Her Royal Highness, Chao Fa (lady of the sky) before the family moves back to Thailand in December that year.
Thai Raksa Chart is an off-shoot of the main pro-Thaksin Pheu Thai party whose government, led by Thaksin's sister Yingluck Shinawatra, was ousted in the 2014 coup.
Thaksin is a Thai businessman and former politician who was prime minister from 2001 to 2006.
Prayuth had been considered the front-runner for the March election because changes in the constitution and election rules implemented by his government make it hard for political parties without military backing to capture the prime minister's post. In general, like most of the royal family, she publicly kept herself aloof from Thailand's recent political turmoil.
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In his royal command on Friday, King Vajiralongkorn affirmed the traditional divide between the royal family and politicians.
She lived in the United States for years, though frequently visited her parents, the much-revered King Bhumibol, who died in 2016, and Queen Sirikit. He said it "conflicts with the country's traditions, customs and culture".
So we don't know. we're really entering an uncharted territory: people are asking whether, if she becomes Prime Minister, would the opposition be able to really criticise and scrutinise her in Parliament - or even launch a no-confidence motion.
Meanwhile, Ubolratana said on her Instagram page on Saturday that she sincerely wished to see the country step forward and be admired and recognized by the global community.
Princess Ubolratana now does not have the same official standing in Thailand as other members of the royal family.
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2004: Ubolratana's son, Bhumi, is killed in the Indian Ocean tsunami. The other two now also live in Thailand. What actually had happened behind the scenes is unlikely to become public, because the royal family's private affairs are nearly never leaked.
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