The former Labour minister today appeared to accept that his political career was over after he lost his bid to overturn the court decision removing him from parliament for lying about an opponent at the general election.
Woolas declared that there would be no further appeal against the decision, paving the way for an election in Oldham East and Saddleworth that will pit the Tories against their Liberal Democrat coalition partners and present Ed Miliband with his first electoral challenge since he became Labour leader.
The high court rejected Woolas's attempt to contest the finding of an election court, which ruled that he should no longer sit as the MP for the Lancashire constituency because he made false statements about his Lib Dem opponent, Elwyn Watkins.
Woolas – who has been suspended from the Labour party – argued that the election court had interpreted the law in such a way as to interfere with his right to freedom of expression, but that argument was rejected by three high court judges.
Lord Justice Thomas, Mr Justice Tugendhat and Mrs Justice Nicola Davies upheld the election court's ruling.
The judges said that, although Woolas was entitled to have one of the findings against him set aside, there had been "illegal practice" by him.
The statements Woolas made about Watkins "were not of a trivial nature", the judges said, adding: "They were a serious personal attack on a candidate by saying he condoned violence by extremists and refused to condemn those who advocated violence."
After the ruling Woolas said: "That is the end – I am out."
But he also complained that the decision was unfair, and said it had created uncertainty about what election candidates could and could not say about each other. "That is not good for a strong democracy," he said.
Watkins, who initiated the court proceedings that led to Woolas being barred from parliament, said the decision was a victory for the people of Oldham East and Saddleworth.
"I fought for a principle, which was that if you lie about your opponent and you know you are telling a lie at the time, then you have no part to play in a democracy," he said.
Watkins – who will stand for the Lib Dems in the election to choose a replacement for Woolas – said he hoped the contest would take place soon.
"With just 103 votes between Labour and myself at the general election, it is going to be a very close contest. I hope that local people will back someone who has a track record for standing up for what he believes in," he added.
In the past, the Lib Dems have often done well at byelections. Watkins has already been campaigning, while Labour has yet to select a candidate.
But the Lib Dems' share of the vote in national opinion polls has halved since the general election and, with the tuition fees controversy still damaging the party, Labour believes it has a strong chance of seeing off the Lib Dem challenge.
Oldham East and Saddleworth is a three-way marginal, where the Tory candidate was only about 2,000 votes behind the Lib Dems in May, and the contest will see them fighting against each other in a close parliamentary contest while sharing power in the coalition.
Nick Griffin, the leader of the British National party, also signalled today that he would stand in the contest.
Last month the election court found that three claims made by Woolas in his election literature about Watkins were untrue and that, because they related to his personal character or conduct, they were an "illegal practice" under the Representation of the People Act.
Woolas had wrongly accused Watkins of going back on a promise to live in the constituency, of wooing Islamist extremists and of not condemning threats of violence.
The election court said Woolas should be barred from standing as an MP for three years.
Today, the high court said the claim about Watkins going back on a promise to live in the constituency was a statement "in respect of his political position" and was therefore not an offence under the Representation of the People Act.
But it said the election court had been right to identify the claims made about Watkins wooing extremists and not condemning threats of violence as statements relating to his personal character. On that basis, the three judges upheld the election court decision.
Woolas said this judgment created uncertainty because "it is now unclear what is political and what is personal".
After today's ruling a Labour spokesman said: "The Labour party administratively suspended Phil Woolas after the original judgment of the election court. Following the conclusion of this judicial review, the Labour party will consider this issue in detail and whether further action is appropriate."