The verdict removed Shehbaz Sharif, chief minister of the Punjab province — home to more than 60 percent of Pakistan's population — from his office and renewed a ban on his brother, former Prime Minister Nawaz Sharif from contesting political office.
The brothers lead the Pakistan Muslim League-Nawaz (PML-N), a right-wing political party which is opposed to the Pakistan People's Party (PPP), previously headed by Benazir Bhutto, the late prime minister who was assassinated in December 2007.
The PPP is now led by Asif Ali Zardari, Bhutto's widower, who was elected as President of Pakistan in August last year.
Western diplomats said the protests would be of little consequence to Pakistan's external partners, including the U.S., as long as they did not cause instability in the nuclear-armed country which remains a key partner to Washington in the fight against Islamic extremist groups.
Pakistani Foreign Minister Shah Mehmood Qureshi and Gen. Ashfaq Kiyani, the army chief of staff, are both in Washington this week to meet members of the Obama administration, as the new White House crafts its policy regarding Pakistan and Afghanistan.
A senior Western diplomat, who spoke Wednesday after the ruling on the Sharif brothers was handed down, warned that, "the outside world will be worried if Pakistan becomes unstable as a result of these protests."
"The next few days will be crucial. If the protests die down, maybe this will be a localized issue, but we can't say for certain right now," he told CBS News on condition of anonymity.
A senior PPP politician, who also asked not to be named, said there was a danger that the Sharif brothers might try to mobilize further, larger protests on the streets of Pakistan, especially ahead of a planned nationwide demonstrations calling for the reinstatement of Iftikhar Mohammad Chaudhary, the former Chief Justice of the Supreme Court who was sacked in 2007 by then-leader Pervez Musharraf.
However, it was clear that the Sharifs' party had immediately begun preparing for a public showdown with the PPP by claiming that the verdict on Wednesday was unduly influenced by Zardari.
"Shahbaz Sharif's membership (of the provincial legislature of Punjab) has been cancelled," said Akram Sheikh, a lawyer for the brothers, after the Supreme Court announced its verdict.
"Asif Ali Zardari had a hand in the disqualification of Nawaz Sharif, and today's decision is also according to his wishes," he claimed.