The High Court of Justice ruled on Tuesday that Lt.-Cmdr. Bentzi Sau must leave his position as secretary of the Internal Security Ministry within three days.
According to the High Court, Sau was appointed to the position illegally.
Sau was given the job earlier this year, after the Or Commission, which probed the October 2000 riots in which 12 Israeli Arabs and a Palestinian were killed in clashes with security forces, found that he had commanded an unnecessary confrontation at Umm el-Fahm.
The commission recommended that "Sau should not be promoted in rank or position from his current post for a period of four years from the day of the publication of the commission's findings."
Rebecca Anna Stoil contributed to this report.