Saudi-backed fighters have largely retaken areas in southern and eastern Yemen seized by the UAE-backed Southern Transitional Council (STC) in December, and an STC delegation has travelled to the Saudi capital Riyadh for talks.
However, STC leader Aidarous al-Zubaidi fled Yemen on Wednesday instead of joining the talks, with the Saudi-led coalition in Yemen saying the UAE had helped spirit him away on a flight that was tracked to a military airport in Abu Dhabi.
One of the members who travelled to Riyadh for the talks said in a statement broadcast on Saudi state media on Friday that the group had decided to disband.
But the STC says it has had no communication with the delegation that initiated the talks under Saudi sponsorship.
A spokesperson who did not travel to Riyadh and is close to Zubaidi said any decision on the group's fate can only be taken by the entire council, including its leader.
Any such decision would only be taken once the delegation in Riyadh "is released," he said.
Saudi Defence Minister Khalid bin Salman welcomed the dissolution decision as a "brave" one.
A conference would be held in Saudi Arabia to discuss southern Yemeni issues with all groups invited, he said.
Yemen was already divided from 1967 until reunification in 1990.
Saudi Arabia and the UAE had previously worked together in a coalition battling the Iran-aligned Houthis in Yemen's civil war, a conflict which caused one of the world's worst humanitarian crises.
But the two most powerful countries in the Gulf have had sharp differences over issues ranging from geopolitics to oil output.
Their rivalry was exposed when the STC advanced to within reach of Yemen's border with Saudi Arabia, which Saudi authorities declared a threat to the country's security.
The STC on Friday called for mass protests in the southern cities of Aden and Mukalla, urging supporters to rally on Saturday in a show of "loyalty and steadfastness" amid the political crisis.
Authorities in Aden aligned with Yemen's Saudi-backed government later ordered a ban on demonstrations in the southern city, citing security concerns, according to an official directive seen by Reuters.
with DPA
