The princess and the Thai Raksa Chart had not responded to the king's statement but the party did cancel a campaign event scheduled for Saturday.
The selection of 67-year-old Princess Ubolratana Mahidol by the Thai Raksa Chart Party marks a shock realignment of Thai politics, as she is now affiliated with a political machine that had been dismissed by hardcore royalists as opposed in spirit to the monarchy.
But Ubolratana's de facto alliance with the forces of the exiled Thaksin - whose comeback the military has made every effort to block - puts Prayuth's supporters in an extremely awkward position. It will be hard to block her political rise because she will be seen as a representative of the monarchy - the nation's most revered and respected institution. Although her father's favorite, she was virtually disowned by him in 1972 when she married an American who was a fellow student at the Massachusetts Institute of Technology.
The signal was clear: the Shinawatras' heartland is Thailand's north and their political colours are red.
"The (party) board agrees that the name of Princess Ubolratana, an educated and skilled person, is the most suitable choice", Thai Raksa Chart party leader Preechapol Pongpanich told reporters.
She is known to be an extrovert.
"The princess is not covered by the lese-majeste law, but of course if people start to criticize her, it may be deemed to be a criticism of the Thai king as she is his sister, so I would not be surprised to see rival candidates back down", said Thitinan of Chulalongkorn University. Ubolratana to some extent was living the typical American life, calling herself Mrs. Julie Jensen, having adopted the nickname Julie during her youth, reportedly in tribute to American singer Julie London.
Her Instagram account was silent immediately after the king's statement. She said she would work with all sincerity and determination for the prosperity of all Thais.
King Maha Vajiralongkorn also cited a provision in the constitution that states the monarch stays above politics and maintains political neutrality.
Parliament has had members who were distant relatives of the monarch.
In an Instagram post, she reiterated that she had relinquished all her royaltitles and now lived as a commoner.
Gen. Prayuth Chan-ocha, who's ruled Thailand since a 2014 coup, also announced he would run.
2003: Ubolratana starred as a princess in a soap opera set in the Ayutthaya period, "Kasattriya". Now you can't follow her unless you were following her prior to that change.
Friday was the last day political parties could nominate their prime ministerial candidates.
They divorced in 1998 and she continued to reside in the United States with her three children until they returned to Thailand in 2001. She is referred to as "Tunkramom Ying", which means "Daughter to the Queen Regent", and is treated by officials as a member of the royal family. She also frequently promotes Thai tourism and movies at worldwide forums. What is surprising is that, for the first time in Thailand's modern political history, a member of the royal family is contesting for the post of prime minister.
The March 24 election has been viewed as a straightforward battle between Thaksin's populists and their allies, on the one hand, and the royalist-military establishment on the other. Violent street protests and two military coups have marked the years since. His sister fled in 2017, also to avoid jail in a case she said was politically motivated.
Prayut, in sharp contrast, is a domineering, splenetic character - an autocratic former general who since he seized power has repressed the naturally rambunctious instincts of Thai politics and society in the self-serving cause of stability. These links were formed as royalists and others loyal to Bhumibol accused Thaksin of showing disrespect for the throne, and even of harbouring secret republican tendencies.