Chris Williamson is suing Labour over his re-suspension for claiming the party was "too apologetic" on anti-Semitism.
The strong supporter of Jeremy Corbyn is preparing for court action in a bid to get readmitted to the party.
The suspension was lifted in July by Labour's National Executive Committee and the Derby North MP was given a formal warning.
But it was re-imposed two days later after an outcry from MPs and Jewish groups.
The case is currently being considered by a new anti-Semitism panel.
Mr Williamson said he hopes to "overturn the unconstitutional decision" to re-impose his suspension from the "party I love".
A source close to him said legal papers had already been filed in court.
No further information was immediately provided.
Labour is understood to be confident its rules were followed and that there will be no successful grounds for a challenge.
Mr Williamson was originally suspended in February after he told a meeting of the Momentum campaign group that Labour was being "demonised" over the crisis.
But, in July, a panel of Labour's National Executive Committee ruled that the suspension should be lifted following a formal warning.
The suspension was reimposed two days later after an outcry from MPs and Jewish groups.
The case is currently being considered by a new anti-Semitism panel.
The MP was suspended in February after footage emerged of him telling the meeting that Labour's reaction to anti-Semitism allegations had led to the party being "demonised".
Asked about the legal action, a Labour Party spokeswoman said: "Chris Williamson is suspended from the Labour Party pending a hearing of the National Constitutional Committee, Labour's highest disciplinary body.
"We do not give a running commentary on individual cases."
A campaign group was attempting to crowdfund £75,000 to support Mr Williamson's legal bid.
Additional reporting by the Press Association
