Antigovernment protesters cheered the verdict. They said they would end their blockade of Bangkok's two airports, whose week-long closure has decimated the country's tourism industry. They also began to vacate the prime minister's compound, which they had seized in August and turned into a protest camp.
But the verdict won't necessarily end the antigovernment People's Alliance for Democracy's (PAD) six-month campaign. Instead it pitches an increasingly lawless divided country into another period of uncertainty as lawmakers try to set up a new government.
PAD activists insist that a root-and-branch reform of the political system is necessary to cleanse it of corruption and dilute the voice of uneducated rural voters. Much of their venom is directed at former Prime Minister Thaksin Shinawatra, whose loyalists in parliament rely on the support of the poor. He was removed by a coup in 2006 and later barred from office.
Tuesday's widely expected court ruling appeared tailor-made to provide a face-saving exit for protesters.
Somchai is the second leader in three months forced out by Thailand's increasingly assertive judiciary. He and at least 30 other party executives were barred from holding public office for five years, as were executives in two other coalition parties also ordered disbanded in the ruling.
To PPP politicians, these verdicts are partisan attempts to undermine their rule by judges who were installed by the previous military government.
Several hundred red-clad government supporters rallied outside the court building ahead of the verdict. Some blocked the highway outside and erected barricades, echoing PAD tactics.
After the verdict was read to groans from the crowd, copies of the court document were handed around. Several people tore up the document or stamped on it. "This is a very sad day for Thai people," says Panee, a retired customs officer.
Others in the crowd railed against the PAD and its elitist agenda for Thai politics. "If you don't have education, it doesn't matter. People can see with their own eyes what's happening here. They think that we are stupid?" asks Panya Thongputpoo, a geographical surveyor.
As the political conflict has intensified, protest sites have turned violent. A string of bombings directed against PAD encampments have killed or seriously injured several people, to the frustration of protesters who complain about police inaction. PAD militiamen at Suvarnabhumi International Airport have attacked police and journalists, and last week fired on government supporters during a daytime rally.
This atmosphere of lawlessness is seen as a possible prelude to a military intervention, although Army top brass have repeatedly denied any coup plots. The Army justified its 2006 intervention on the grounds of widespread corruption by Thaksin, who was recently convicted in absentia of abusing his powers when in office.
Thaksin is living in self-imposed exile but is in close touch with Somchai, his brother-in-law, and other allied politicians.
A partial retreat by the PAD will give some breathing room to competing political forces after months of tension.
But the success of the group's hardball tactics, and its hostility to any pro-Thaksin administration, could impede any return to normalcy. PAD activists have called for an appointed government to take over and reform the political system.
Thailand also faces hard economic times, compounded by its political instability. Some economists have predicted a contraction next year, the first in a decade.
A deep recession is likely to weigh heavily on poorer Thais, who are among the staunchest supporters of Thaksin.
As prime minister, the billionaire businessman introduced rural microcredit and subsidized healthcare in Thailand.