Poland's right-wing government announced on Saturday it wanted Polish Euro-MP Saryusz-Wolski instead of its long-term foe Tusk, who remains the EPP's official candidate for the EU's top post.
"Today, the EPP has revoked Jacek Saryusz-Wolski's title as EPP Vice-President" the group's chief Joseph Daul said in a statement.
"I deeply regret Saryusz-Wolski's disloyalty and disrespect towards the unity and values of his own member parties," Daul added.
Euro MPs will vote whether to fully exclude him from the parliamentary party later this week, officials said.
Saryusz-Wolski insisted that he himself had resigned from the party, the biggest group in the European Parliament.
"I made a quick farewell visit to the EPP headquarters where I presented my resignation to president Daul due to the current situation," he told Polish media.
EU leaders are set to decide on a second term for former Polish premier Tusk at a summit in Brussels on Thursday in a process that was expected to be unopposed.
Tusk is still set to be re-elected as Warsaw cannot veto his appointment under EU rules, but the Polish government insisted on Monday it would stand behind Saryusz-Wolski.
"This is the only Polish candidate in the race for the European Council president. There is no other Polish candidate," Polish Foreign Minister Witold Waszczykowski said as he arrived for a meeting in Brussels.
Asked which other countries would support Saryusz-Wolski, the Polish foreign minister said: "I'm not interested in who supports him, what interests me is that he is our candidate and that he is running."
He said he was not sure if Saryusz-Wolski would be at Thursday's summit.
Meanwhile Jaroslaw Kaczynski, the hardline boss of Poland's governing Law and Justice party (PiS), said Tusk was the "German candidate".
Asked whose candidate Tusk would be after Warsaw backed a rival, Kaczynski said: "Angela Merkel's, he is the German candidate."
Tusk, a former centre-right Polish prime minister, became president of the European Council, gathering EU heads of state or government, in late 2014.
Warsaw's move threatens to create bad blood at a time when the crisis-hit EU can ill afford more internal strife.
Tusk has been sharply at odds with Poland's rightwing government, especially Kaczynski, over a range of issues including changes to state media and the constitution.
Kaczynski accuses him of bearing "moral responsibility" for the death of his twin brother Lech Kaczynski, who was then president, in an air disaster in 2010 that also killed 95 others.