Thai Raksa Chart is backed by exiled ex-PM Thaksin Shinawatra, who was deposed by a military coup in 2006.

Analysts say dissolving the party will make it harder for Mr Thaksin's supporters to win the national election due later this month.

Thailand is run by the military, which took over in a coup five years ago.

The Constitutional Court, which issued Thursday's ruling, said Princess Ubolratana's nomination threatened the neutrality of the monarchy.

The party's executive board members have been banned from politics for 10 years, and it can no longer contest the election.

"The monarchy is above politics, and to maintain political neutrality, the king, the queen and princesses can never exercise political rights by casting votes," Judge Nakharin Mektrairat said at the end of an extensive ruling.

A royal candidate would have given forces loyal to Mr Thaksin a decisive advantage in this month's election, says the BBC's Jonathan Head in Bangkok.

Thursday's move will rob the pro-Thaksin camp of enough parliamentary seats to put its goal of winning a majority in the election almost certainly out of reach, our correspondent adds

Thai Raksa Chart was seen largely as a proxy for Pheu Thai, the main pro-Thaksin party, to get more seats, analysts say.

A new 2017 constitution introduced a rule that there would be a ceiling on how many seats each party could win.

The 24 March vote will be the first since the current Prime Minister, Prayuth Chan-ocha, took power in a 2014 military coup - overthrowing the democratically elected government.