The Lagan Valley MLA was given a formal warning by UUP the after appearing before its disciplinary committee for a three-hour meeting in Belfast.
It followed comments he made in the media about the flying of the Union flag on designated days, which the party deemed out of line with its policy.
Mr McCrea disputes this, saying he has "stayed true to the core of the party", and added that he doesn't understand the ruling.
"I put forward a case that I've spoken only on party policy and I haven't attacked anybody," he told UTV.
I'm disappointed and a little surprised with the decision that they've come to but nevertheless if they want to talk to me about it I'm happy to talk to them
"I don't understand why they've reached the decision they've reached, which is not to say they're wrong, I just don't follow their reasoning.
"I will take time to speak to my local association, explain the matter to them and depending on what they say I'll decide what's the best way forward."
Mr McCrea, who has already had the party whip removed, appeared before the five-strong panel at the UUP headquarters in Belfast earlier this month.
The party said the unionist politician was found "guilty of indiscipline and of speaking in a manner that was detrimental to the Party interest" following remarks made during a radio interview.
He was also found guilty "of a public attack on Party policy and consequently of a further act of indiscipline" after separate comments made in a local newspaper and on local radio.
The UUP stopped short of expulsion or suspension.
Mr McCrea had the UUP whip removed by leader Mike Nesbitt after he said he agreed with the Alliance Party motion of flying the flag on designated days at Belfast City Hall.
He also said he felt his stance was in accordance with UUP policy.
He later opposed his party over a DUP amendment to a UUP motion calling for the Assembly's commitment to inclusivity, mutual respect, peace and democracy, in the wake of the flag unrest.
The DUP wanted to remove a reference to the Good Friday Agreement.
Asked whether he now plans to resign from the Ulster Unionists, Mr McCrea said: "I think that's looking far too far into the future".