Yigal Guetta recently told a radio interviewer about the marriage of his nephew, which took place two years ago but still brought a harsh reaction from prominent rabbis, local media reported.
Today morning he handed his resignation to the chairman of his Shas party, Interior Minister Aryeh Deri.
His daughter Simcha Guetta said she was proud of him for his family loyalty.
"It's his nephew," she told Israeli public radio.
"In submitting his resignation he apparently knows what he is doing," she said. "I am behind him all the way."
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"Yigal should not have taken part in that celebration," he told army radio.
"There is no situation in which it is permitted to take part in an event like that," he said. "It is totally forbidden."
In the August 29 army radio interview that sparked the criticism, Guetta said although he wanted to stand by his nephew he made it clear to his own children that his lifestyle was taboo.
"We went together to the wedding, me, my wife and my children," he said. "I told them 'attendance is mandatory'."
While the Jewish state is considered a trailblazer in the promotion of and respect for gay rights, homosexuality remains taboo among the religious and ultra-Orthodox parties wield significant political power.
Civil marriage does not exist in Israel, where marriage and divorce are entirely controlled by religious authorities and homosexual weddings are not recognised.
When the Israeli interior ministry announced in 2014 that it would, however, recognise same-sex marriages performed abroad, Shas MP Nissim Zeev lambasted what he called "the dangerous institutionalisation of the phenomenon of homosexual families in Israel".
"God says you shake your genitals where you are not supposed to and I will shake my world in order to wake you up," he said.