Grigule's withdrawal from the 48-member Europe of Freedom and Direct Democracy group, means it now contains members from six rather than seven EU member states, making it ineligible to exist as an official group in the European Parliament.
Being a group entitles members to a variety of advantages including extra seats on committees and extra funding opportunities.
The news of Grigule's defection was broken by European Parliament spokesman Jaume Duch who tweeted: "Latvian MEP Iveta Grigule left #EFDD group today. #EFDD no longer has members from at least 7 countries, so declared dissolved today."
In a statement to the LETA news agency, Grigule said she had made her decision after being surprised that UKIP leader Nigel Farage was using the group as a platform for British domestic politics and that the group's business was carried out exclusively in English.
She will continue to work in Brussels as an independent MEP, she said, while claiming she had already received offers to join other groups.
She only joined the group less than four months ago, on June 18.
Grigule is no stranger to controversy, having been the most vocal opponent of Latvia's adoption of the euro during the run-up to the currency switch.
She also caused widespread hilarity during her campaign to become an MEP by taking out large billboard ads that seemed to bear the hallmarks of some serious retouching work by the designer.