Labour member Neil Thomson - who faces expulsion from the party - will challenge Mr Woodward in the St Helens South constituency.
"
There are people in St Helens who have been in the Labour Party a long, long time who are better candidates than Mr Woodward
"
Neil Thomson
Mr Thomson said he was running, in part, because he objected to the way Mr Woodward, a former Tory communications director, was "parachuted" into the normally safe Labour seat.
Mr Woodward was selected as a prospective parliamentary candidate on Sunday following the last minute decision of the sitting MP, Gerry Bermingham, not to stand again.
Mr Thomson said he had decided to run because of the way the party had handled the selection.
"I feel, like many other Labour Party members, very, very disillusioned with the way this individual has been brought into our constituency to try to represent the people of St Helens," he told BBC News.
"There are people in St Helens who have been in the Labour Party a long, long time who are better candidates than Mr Woodward.
"I think it is outrageous for the Labour Party to disregard the feelings of not only the Labour members of St Helens but the people of St Helens."
But former St Helens' council leader and constituency executive member Mike Doyle defended the selection of Mr Woodward.
'Open' process
And he denied that that local people were excluded from seeking the nomination as the Labour candidate.
"Everybody was allowed to be self-nominated which is an open and democratic process and also on the day itself ... final interviews took place and the selection was made," Mr Doyle said
The majority of the 164 Labour members who voted supported Mr Woodward, he said.