Michigan, with 156 delegates, has scheduled a Jan. 15 primary. Democratic Party rules prohibit states other than Iowa, New Hampshire, Nevada and South Carolina from holding nominating contests before Feb. 5.
Florida was hit with a similar penalty in August for scheduling a Jan. 29 primary.
States across the U.S. have been vying to schedule their primaries earlier in an attempt to gain influence as the early contests play a critical role in winnowing the field of presidential candidates. The early primaries traditionally play key roles in providing momentum to the top finishers for the following round of contests in other states.
Michigan officials anticipated the action by the Democratic National Committee's rules panel. But Michigan Democratic Chairman Mark Brewer said before the vote that he did not think the delegates would be lost for good. He expects the Democratic presidential nominee will insist the state's delegates be seated at the convention.
Nevertheless, Saturday's vote further diminishes the significance of Michigan's Democratic primary. All the major Democratic candidates have already agreed not to campaign in either Michigan or Florida because the states violated party rules. And in Michigan, most of the major candidates will not even be on the ballot.
Democratic candidates John Edwards, Barack Obama, Bill Richardson and Joe Biden have withdrawn their names from the ballot to satisfy Iowa and New Hampshire, which were unhappy Michigan was challenging their leadoff status on the primary calendar.
That leaves Hillary Rodham Clinton, Dennis Kucinich, Chris Dodd, Mike Gravel and "uncommitted," as the choices on the Democratic ballot in Michigan.
Michigan officials defended their early primary, saying it helps provide geographic, racial and economic diversity early in the primary calendar. They also complained that other states that were allowed to hold early votes were receiving preferential treatment.
"I think it is unconscionable that we continue to grant special treatment to some states in this process," Brewer told the DNC rules panel.
Alexis Herman, co-chair of the DNC rules panel, said party leaders worked for two years to create a primary calendar that respected the historic roles of Iowa and New Hampshire, while adding geographic and racial diversity by allowing Nevada and South Carolina to vote early.
Other panel members sympathized with Michigan, but they said they must enforce the rules.
"While we may not like the rules, if we don't respect the rules, then we are going to have chaos," said committee member Yvonne Gates of Nevada.
Both political parties have been struggling to control their chaotic calendars.
The Republicans have stripped half the delegates from New Hampshire, Florida, South Carolina, Michigan and Wyoming for scheduling early primaries and caucuses. Republican rules do not allow any states to hold nominating contests before Feb. 5.
The Republicans, however, have not set any restrictions on campaigning in states that violate party rules. That has some Democrats concerned that they could lose votes in Florida, the fourth largest state, and Michigan, the eighth largest.
Former DNC Chairman Don Fowler, a member of the rules panel, said stripping the delegates from Michigan and Florida and prohibiting candidates from campaigning there during the primaries will hurt party-building efforts in those states.
Fowler also said that stripping the delegates was unnecessary, since many party insiders believe that the eventual nominee will have them restored at the convention.
"No one at this table believes that the delegates from Florida and Michigan will be absent from the convention," Fowler told the rules panel.
Senator Carl Levin, a Michigan Democrat, said in a statement: "The threat not to seat the delegates of Michigan and Florida at the Democratic convention is a hollow threat. They will be seated, and when they are, it will be plain for all to see that the privileged position that New Hampshire and Iowa have extracted through threats and pledges from candidates is on its last legs."
Under convention rules, a credentials committee controlled by the presidential candidate with the most delegates will verify the legitimacy of delegates.
With Florida and Michigan stripped of delegates, Democratic candidates will now need support from at least 2,026 delegates to secure the nomination.
The panel gave Michigan officials 30 days to change their minds and schedule a later vote, but Brewer said the state will stick with Jan. 15.
Debbie Dingell, a DNC member from Michigan, said the state party will work for the party's nominee, regardless of the delegate flap.
"Michigan will pull together," Dingell said. "We know how to fight."
With the DNC's work Saturday, the primary calendar appears to be set. The panel approved some final shifting of early contests, approving the Iowa caucuses on Jan. 3, the New Hampshire primary on Jan. 8, and the South Carolina primary on Jan. 26. The Nevada caucuses had already been approved for Jan. 19. The panel also gave final approval for Massachusetts to move its primary from March 4 to Feb. 5.