It is expected that under party rules her seat will now go to comedian Eddie Izzard - the next next most popular candidate at the last NEC election - although party sources said they would have to account of the gender balance of the committee.
In a massive and detailed expose likely to deal a further blow to the embattled Labour leader, the right-of center newspaper reported that Jewish Labour MP Luciana Berger and Board of Deputies head Jonathan Arkush were among those regularly targeted in abusive messages on Facebook groups supportive of Corbyn.
Shadow digital minister Liam Byrne admitted there was "real alarm" at the scale of the problem.
As the runner-up when she was elected previous year, Mr Izzard now automatically takes her place.
But a Jewish Labour peer said the party leader had "encouraged and endorsed" anti-Semites.
Izzard, who said he was honoured to step up and represent the party, continued: 'We must get past this, for the good of the people Labour seeks to represent'.
'We must make amends and fix the damage with the Jewish community as Jeremy Corbyn has promised to do'.
A Few Strong To Severe Storms This Evening
By Friday , the rain will wrap up and we'll be left with morning clouds, which should break by midday. Forecasters are warning of damaging wind gusts as well as the possibility of small tornadoes.
"On the contrary, I have been witnessing, since Mr Corbyn became leader, a philosophical and a political policy which espouses, in almost every respect, the very antithesis of the great party under whose reputation, and under whose flag, it now seeks to fly and where so many other Jews were once so proud to stand".
The Sun has not been able to independently verify these claims, and there are no suggestions that these posts have been made by members of Corbyn or McDonnell's staff.
Mr Watson also called for the party's new general secretary Jennie Formby to ensure there was a swift resolution to the case of Mr Livingstone - a long-time ally of Mr Corbyn who was first suspended in 2016.
Last week, Corbyn apologised for arguing on Facebook in 2012 against the removal of an anti-Semitic mural that depicted a group of Jewish men playing Monopoly on the backs of a group of emaciated people.
An investigation into 20 of the largest pro-Corbyn Facebook groups - comprising of around 400,000 members - had uncovered attacks on Jewish people, including Holocaust denial.
A Labour Party spokesperson said: "These groups are not officially connected to the party in any way". "As one of the former leading political and financial supporters of the Labour party, of which I was a member for so many decades, I no longer feel any affinity with, or connection to, what it seems to have become", he said.
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