The decision to drop Harriet Wallberg and Anders Hamsten came after the Swedish government sacked the entire board of Sweden's prestigious Karolinska Institute, where the scientist worked, the BBC reported.
The two judges who lost their positions on the Nobel panel have both served as heads of the Karolinska Institute, and were among several individuals suspected of ignoring warnings about the Italian windpipe scientist.
Stem-cell surgeon Paolo Macchiarini, who denies any wrongdoing, faces numerous accusations of scientific fraud and misconduct resulting in the death of two patients and being investigated on suspicion of gross criminal negligence.
The case has come as a severe blow to the institute. In a report on the case on Monday, a former Swedish judge said he had "never seen such negative references" and questioned why the surgeon had been initially hired and then had his contract extended.
"Confidence in the two principals is so seriously damaged that it has been exhausted," panel's secretary Thomas Perlmann told Sweden's TT news agency.
"The damage is so great, and of such a character, that we will ask them to resign from the Nobel Assembly."
The 50-member Nobel panel is due to announce the winner of the annual prize in October.
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