Thailand's King Maha Vajiralongkorn has described an unprecedented move to make his older sister Princess Ubolratana prime minister as "highly inappropriate" and against "royal traditions".

The princess, who is 67 and the older sister of the king, was announced as a candidate in the upcoming elections for the Thai Raksa Chart party, which is steered by the divisive Shinawatra political clan.

Her shock entrance into frontline Thai politics was a first by a member of the powerful royal family and promised to reshape the political landscape of the country.

But a statement from the palace left no doubt over the King's displeasure at the move.

"The king and royal family exist in a status above politics," said the statement, published in the Royal Gazette and given blanket television coverage.

The statement did not criticise Princess Ubolratana, instead praising her public work.

But it appeared aimed at those behind her sudden stride into politics.

"To bring a senior royal family member into the political system in any way is against royal traditions and the nation's culture ... which is very inappropriate."

While the monarchy, which is vastly wealthy and protected from criticism by a harsh royal defamation law, has been seen as above the political fray, royals have intervened in moments of political crisis.

In a day of drama, junta chief Prayut Chan-O-Cha also declared his candidacy for premier, running for the pro-military Phalang Pracharat party, moments after the princess's announcement.

Election authorities have a week to review which candidates put up by each party are allowed to run for premier after the 24 March poll.

The announcement pits a royal-fronted party tied to the Shinawatras directly against a military party, whose own candidate was also announced today as junta leader Prayut Chan-O-Cha.

A party official holds an election registration document bearing the image of Thai Princess Ubolratana

The princess is set to stand for prime minister on behalf of the Thai Raksa Chart party.

It falls under the tutelage of Thaksin Shinawatra, a billionaire self-exiled former premier, who stands at the heart of Thailand's bitter decade-long political schism - loathed by the army and Bangkok elite, yet adored by the rural poor.

The announcement pits a royal-fronted party tied to the Shinawatras directly against a military party, whose own candidate was also announced today as junta leader Prayut Chan-O-Cha.

Mr Prayut has headed the junta for nearly five years, scripting a new constitution in a bid to recast the entire political system to ensure the army has a foothold on power after elections on 24 March.

But the shock entrance of Princess Ubolratana is likely to throw the military's plans into disarray.

Princess Ubolratana, a colourful, public-facing royal in contrast to her more restrained brother King Maha Vajiralongkorn, relinquished her royal titles after marrying an American decades ago.

But the couple eventually divorced and she moved back to Thailand where she is still considered part of the royal family.

Thailand has not had a royal as premier since becoming a constitutional monarchy in 1932.