Published Monday, 30 January 2012
The Strangford MLA has now quit the UUP Assembly group over the disciplinary action, which was taken over comments he made in a newspaper interview about "secret talks" with the DUP.
Asked if he felt stitched up, Mr McNarry said he did - but insisted he was not leaving the party itself.
"I've been in the Ulster Unionist Party since I was 15 - I'm not going anywhere. I'm not joining the DUP," he told UTV Live.
But, speaking about the action taken by Mr Elliott, he added: "I feel badly damaged and betrayed.
"I've tried to protect him (Tom Elliott) and the longer and the more he talks, the more he's digging a hole for himself."
Earlier on Monday, Mr Elliott said that quitting the party's Assembly group was an over-reaction by Mr McNarry and that he had no regrets about disciplining him over his media comments.
He had informed me that he was going to carry out the interview and that I had said: 'That's fine, providing you stick to the course and lines we have issued'. But I believe he went far and beyond that.
Tom Elliott, UUP
The circumstances leading to the row began when DUP leader and First Minister Peter Robinson told UTV last week that he would like to see one unionist party in Northern Ireland.
Mr McNarry gave his reaction, voicing support for greater cooperation between unionist parties, then revealed to the Belfast Telegraph that he had actually taken part in "secret talks" with the DUP.
"I believe that David went beyond his remit in his interview," Mr Elliott said on Monday.
"Not because he was talking to the DUP - that was not an issue, because he was mandated to do that - but the issue was around how far he went in the interview."
Immediately after receiving a call from his party leader on Friday night, Mr McNarry responded to the disciplinary action by issuing a statement saying he was quitting the Assembly group.
On Monday, claiming his integrity was on the line, he made his decision official.
"I had hoped he wouldn't have done that - that certainly wasn't my intention," Mr Elliott responded.
"I have known David for a long, long time, so it disappoints me."
But Mr Elliott - particularly angered by Mr McNarry's claim that in the future the DUP could hold Stormont's First Minister position, with the UUP holding the office's Junior Minister post - stands by the action he has taken in disciplining one of his senior party members.
"It wasn't a hanging offence, the punishment certainly wasn't severe - all I was doing was to remove the vice-chairmanship of the Education Committee," Mr Elliott said.
"Lots of people in this party don't have any chairman or vice chairmanships, so I just believe it was the least level of punishment you could offer at all.
"But he decided to remove himself from the Assembly group."
Mr McNarry, who on Monday also revealed that Mr Elliott had himself taken part in the talks with the DUP, took his seat alongside independent members in the Stormont chamber.
With the Ulster Unionists divided over unionist unity, some political commentators sense that the row could actually turn into a leadership issue before the party's AGM at the end of March.