Race stewards stripped Fernando Alonso of his Hungarian Grand Prix pole position on Saturday and barred his championship-leading McLaren team from scoring constructors' points in Sunday's race.
McLaren, 27 points clear of Ferrari in a title contest overshadowed by a spy controversy linking the two increasingly bitter rivals, said they would appeal against their penalty.
Alonso was given a five-place demotion for unnecessarily impeding his team mate and championship leader Lewis Hamilton in the pitlane in the final seconds of qualifying.
The decision left 22-year-old British rookie Hamilton, who leads Alonso by two points with seven races left, in top slot with BMW Sauber's German Nick Heidfeld also on the front row.
Hamilton had led the session until Alonso pipped him by 0.107 seconds with his final lap right at the finish after blocking him in the pitlane.
The Briton had to sit in his car behind Alonso with the seconds ticking away and the Spaniard, who would regain the championship lead if he won on Sunday, failing to move off.
The extra 10 second wait left Hamilton unable to get round the circuit in time to start a final flying lap before the chequered flag.
The stewards blamed the team and Alonso.
"The actions of the team in the final minutes of qualifying are considered prejudicial to the interests of the competition and to the interests of motor sport generally," the stewards said in a statement.
"The penalty to be applied is that such points (if any) in the 2007 Formula One constructors championship as accrue to the team as a result of their participation in the 2007 Hungarian Grand Prix will be withdrawn."
Dennis had said Hamilton was to blame for failing to obey repeated team instructions to let Alonso go past earlier in the session at a stage when drivers were burning off excess fuel.
"They were out of sequence because Lewis should have slowed and let Fernando past and he didn't. He charged off," said Dennis.
Alonso, facing pointed questions about the incident at a stormy team news conference, said he had been told by the team to wait for a gap in traffic and saw nothing unusual in doing so while his engineer counted down the seconds.
"Every qualifying we stop and we wait," he said. "Sometimes 10 seconds, sometimes five, sometimes 45 as with the first stop today."
Hamilton, whose relationship with Alonso has been distinctly edgy since he started beating the 26-year-old champion, disagreed openly with the Spaniard.
Asked how much more time he would have needed to cross the start/finish line before the end of the session, Hamilton said: "About the same amount of time I was held up in the pitstop."
"I really don't understand why I was held back. So I guess you should ask the team and I definitely will do when I go back and have a debrief," said the Briton.
He and Dennis also exchanged angry words on the radio at the end of qualifying.
"I was quite firm on the radio and he was reasonably firm back," said Dennis of their conversation.
Ferrari's Kimi Raikkonen, a winner in 2005 with McLaren, moved up to third place on the grid with Germany's Nico Rosberg in fourth place for Williams.
Ferrari's Brazilian Felipe Massa, third in the championship and 11 points adrift of Hamilton, will start 14th after a pitlane misunderstanding left him without fuel.
Briton Jenson Button, who took an emotional first grand prix win from 14th place in a wet race in Hungary last year, qualified his Honda in a disappointing 17th position.