Thailand's Supreme Court has asked the five members of the national Election Commission to resign for failed to stop abuses during April's poll.
Thailand's senior judges will run the new election
It also said there would not be time for new commissioners to be appointed before another vote, so judges would have to organise new elections.
The decision came a day after another top court, the Constitutional Court, annulled the results of the April poll.
Fresh elections must now take place within 60 days.
Thailand has been in political limbo for more than five weeks.
Because the main opposition parties boycotted the election, some of the seats in parliament were not filled, preventing it from sitting.
So the country has been without a proper government, and Prime Minister Thaksin Shinawatra has also given up his day to day duties after announcing he was stepping aside.
According to the BBC correspondent in Bangkok, Jonathan Head, the country has not experienced political confusion like this since the end of military rule in 1992.
The Constitutional Court decision that the April election was invalid does not solve all the country's problems, but at least it provides a way forward.
Democrat Party leader Abhisit Vejjajiva has said he will take part in new elections, preventing a repeat of the problems inherent in the last poll.
But even with Monday's ruling, it remained unclear who was really running the country, and who would also manage the new vote.
Now it seems that Thailand's top judges are the ones in charge, complying with a request by the country's revered King Bhumibol Adulyadej, two weeks ago, that they sort out the "mess". This is the biggest role Thailand's judiciary has ever played in shaping the political landscape, our correspondent says.
Their role has become so central because the independent bodies established under the 1997 constitution that were meant to regulate the politicians, like the Election Commission, are widely viewed to have failed in their remit.
Hence the judges' suggestion that members of the Election Commission resign.
Supreme Court spokesman Jaran Pakdithanakul admitted that "no one can force them" to step down.
"However, if they make a sacrifice and open the way for a new election process, it will be considered a good deed for the country," he said.