Eleven councillors who quit Labour over Sir Keir Starmer's decision not to push for a ceasefire in Gaza have formed a coalition with the Greens and Lib Dems.
Burnley Council leader Afrasiab Anwar, confirmed he and the 10 other councillors would be part of a new administration on the council.
Mr Anwar said: "We thought it was important for the people of Burnley that the council was operating."
The Labour Party has been approached for comment.
The party has backed the government's stance of calling for Israel to pause its action against Hamas to allow aid into Gaza.
Asked if the group would rejoin Labour if the party changed its policy, Mr Anwar said: "It's far too early to talk about that - we have an immediate job to do."
He added: "We will still be campaigning for Gaza."
The new Co-operative Alliance includes the new Independent Group, the Green Group, and the Liberal Democrat Group, and will have 25 councillors, which gives the coalition an overall majority with Mr Anwar remaining as council leader.
Burnley Council's new executive includes six members, with two members from each of the parties in the Co-operative Alliance.
Labour has had a number of resignations in councils across England over its stance on Gaza, including in Oxford where the party has lost control of the city council.
Israel began its operation in Gaza after Hamas killed more than 1,400 people in Israel and kidnapped more than 200 others on 7 October.
It has carried out thousands of air and artillery strikes, while a ground offensive is ongoing.
The Hamas-run health ministry in Gaza has said more than 11,240 people have been killed since 7 October.