Several Saudi officials, including the two members of the royal family were sacked over investigation into “suspicious financial dealings” at the Ministry of Defence.
A royal decree said Saudi King Salman had relieved Prince Fahad bin Turki of his role as commander of joint forces in the Saudi-led coalition in Yemen.
His son, Abdulaziz bin Fahad, was also removed as a deputy governor.
The Royals, along with four other officials face an investigation into “suspicious financial dealings” at the Ministry of Defence, the decree said.
Crown Prince Mohammed bin Salman, who is the king’s son and is considered Saudi Arabia’s de-facto ruler, has spearheaded a campaign against alleged corruption in the government.
However, critics say the high-profile arrests have been aimed at removing obstacles to the prince’s hold on power.
Earlier this year, three senior royals had been arrested, including the king’s younger brother Prince Ahmed bin Abdulaziz and former crown prince Mohammed bin Nayef, the Wall Street Journal reported.
The most high-profile incident, in 2017, saw dozens of Saudi royal figures, ministers and businessmen detained at the Ritz-Carlton hotel in Riyadh.
Most of them were later released, but only after reaching settlements worth a total of $106.7 billion with the Saudi State.
Crown Prince Mohammed bin Salman, 35, won international praise when he promised a series of economic and social reforms to the deeply-conservative country after coming to power in 2016.
However he has been embroiled in a series of scandals, including the murder of Saudi journalist Jamal Khashoggi and an alleged murder plot against a former Saudi intelligence agent in Canada.
He has also been criticised over the continuing conflict in Yemen, where Saudi Arabia backs pro-government forces, and the harsh treatment of women’s rights activists, despite the lifting of some restrictions including the right to drive.