Larsson tells the tabloid Expressen that the way the leadership is running the party has spread fear among the members.
"This leadership cult that the party has today is unhealthy. If you go against the leadership in terms of opinions and thoughts you can be fired, expelled our bought out. Everybody knows it," Larsson said.
She describes how the politicians in the party are supervised and micro managed.
"This is a power disease. I can compare it with a disease that does not go the right way, but is getting worse. Considering the Sweden Democrats are a party that hate communism it is pretty surprising that they use the same methods themselves," she told the paper.
Margareta Larsson has in the past been the member of the party's nominating committee. She says she reached her decision to leave the party this summer. She tells Expressen she had not even informed her daughter, Jimmie Åkesson's girlfriend and the mother of his child, about the decision. She will now take time-out, but wants to keep her seat in parliament.
In a statement, the leader of the party's parliamentary group, Mattias Karlsson said that he regrets Margareta Larsson's decision, but that it will not in any way affect the group's efficiency or work in parliament.
"Margareta has been ill or on sick leave during a larger part of this term in office and has therefore not been able to carry out much work of significance for the party. There are strong indications that the real reason for the accusations is Margareta's health and the fact that there are people close to Margrareta who are in an economic conflict with the party," he says in the statement.