DUP councillor Ruth Patterson has been charged with posting a "grossly offensive communication" and is to appear in court later this month.
The 57-year-old has apologised for her "lapse of judgment" when posting a Facebook comment in support of a make-believe account of a loyalist murder attack on a planned republican commemoration parade scheduled for Co Tyrone next weekend.
The original post imagined an attack on the republican event in which several senior Sinn Féin figures were murdered.
Mrs Patterson wrote: "Who cares how we would be judged, we would have done a great service to Northern Ireland and the world . . ."
She added: “Would I shed a tear? No. Would I loose (sic) a night’s sleep? No, would I really worry about what anyone else thought? No.”
Her party has publicly reprimanded her, claiming her comments were “completely unacceptable and not in keeping with the party’s policies or the standard of behaviour required of our members”.
There was initial anticipation that Mrs Patterson, who has stirred controversy before, might be expelled by party leader Peter Robinson after Sinn Féin pressed him to take action.
Last May she addressed Carrickfergus United Loyalists in face of the Union flag protest, claiming: “I am ashamed of the PSNI at the moment. Their political policing and persecution of our Protestant people must stop,” she said. “They beat our women and children off the streets. They throw our pensioners into jail, they jail our young folk for waving the Union flag of the country.”
However, she appears to have been thrown a lifeline after the DUP issued a statement which said her open apology would be taken into account. A second statement was later issued in which it severely criticised her arrest, branding it “sensationalist”.
“We fail to understand why the police chose to conduct a sensationalist arrest rather than contact Ruth and ask her to attend an Article 10 voluntary interview,” the DUP said. “This is a matter we will be raising with the Chief Constable.”
The Tyrone IRA Volunteers Commemoration in Castlederg next Sunday is vehemently opposed by unionists and is the subject of Parades Commission rulings.
It is the latest controversial demonstration in a tense summer. There was rioting in Belfast following the annual July 12th marches and the imposition of restrictions on the Orange Order march past Ardoyne which has witnessed serious disturbances in recent years.
Belfast has seen sporadic violence in the nights following the decision and increased tensions in the mostly loyalist east of the city. The DUP is keen to hold its support in East Belfast, DUP leader Peter Robinson’s former Westminster seat, and in the Village area of south Belfast where Mrs Patterson is a councillor.
The British government is known to have growing concerns over the situation provoked by parades in Belfast.
