'Apparently, my comments about the party being run like a squash club committee and Mr Carswell have not gone down well.
In a statement, Banks said: "The party has somehow managed to lapse my membership despite my having given considerably more than the annual membership this year! We will now be concentrating on our new movement".
Banks, who has pumped more than £1m into Ukip coffers, last month demanded to be made chairman of the party so he could stop it "being run like a jumble sale".
Earlier this month Mr Nuttall claimed the party would be able to survive without his funding, telling the BBC's Andrew Marr: 'Arron has never been Ukip's major donor.
The poll also showed that the Conservatives were 17 points ahead of Labour as Theresa May plans to invoke Article 50 of the Lisbon Treaty and trigger Brexit talks.
"I now realize I was being unfair to squash clubs all over the United Kingdom and I apologize to them".
Mr Nuttall had replied saying while "any and all contributions to our work are welcome. the party chairmanship is not on offer".
Mr Banks previous year gave Ukip £199,000 making him the party's third biggest donor.
But Mr Carswell played down the importance of Mr Banks' announcement, telling the BBC: "It's always very sad when one of UKIP's 40,000 members leaves the party for whatever reason".
On Twitter, Banks described his new movement as "Ukip 2.0, the Force Awakens".
Inspired by the US President's calls to "drain the swamp" in Washington DC, Mr Banks - who visited Donald Trump alongside former UKIP leader Nigel Farage after the US election - has spoken about his ambition to overhaul Westminster politics.
"With this his membership expired on 1st January 2017", the spokesman said.
On being elected leader he had promised to unite all sides of the party but this soon began to look near impossible when the Faragists turned on the Carswell contingent (for not being "radical" enough) over the Stoke by-election loss.