The granddaughter of Italy's former fascist dictator Benito Mussolini is reported to be leaving the right-wing National Alliance party.
Ms Mussolini says Mr Fini's comments are prejudicial
Alessandra Mussolini is said to have made her decision after comments by Deputy Prime Minister Gianfranco Fini.
Mr Fini, who leads the party in the governing coalition, denounced Italy's fascist past during a visit to Israel.
Ms Mussolini said "what has been sanctioned is something incompatible with, and prejudicial to, my surname".
Reuters news agency said party officials were meeting her in an effort to try to convince her to change her mind.
She has said she will remain a member of the lower house Chamber of Deputies and join a group of non-aligned deputies.
Mr Fini once described Benito Mussolini as the "greatest statesman of the 20th Century".
But in Israel Mr Fini is reported to have described fascism as an absolute evil.
In comments broadcast on Italian radio and television, he added that "laziness, indifference, complicity or cowardice ensured that so many Italians in 1938 did nothing to react to the appalling fascist race laws".
The National Alliance is the successor to the neo-Fascist Italian Social Movement party, which was disbanded in the mid-1990s to form the new party.