A special parliamentary committee on Wednesday backed the motion to repeal the contentious anti-defection law.
Parliament on Wednesday voted to accept the motion and forwarded it to a special committee with 34 lawmakers in favour.
The seven member committee had later unanimously backed the motion to repeal the law.
The outgoing government controlled parliament in March had passed the anti-defection law largely devised to disqualify a dozen former government lawmakers.
Top ruling party lawmaker Riyaz Rasheed had filed the motion in parliament to repeal the law.
According to the law, lawmakers elected on party tickets would lose their respective seats if they quit, change or are dismissed from the party. However, the law would not apply to independent members if they sign for a particular party.
The law also does not apply to lawmakers for violating party whip-lines or are penalized by a party for disciplinary violations.
Almost all lawmakers during the debate on Wednesday agreed that the law contradicted several constitutional rights. However, some members had insisted on the need for such a law to be brought in once the necessary constitutional amendments are passed.
