Butler hauled off goalkeeper Ahmad Sharbinee Allawee in Saturday's 1-1 home draw with Kedah in the Malaysian Cup after he appeared to fumble a corner into his own goal.
Last week, the no-nonsense coach kicked out two senior players - Muslim Ahmad and Ismail Faruqi - for allegedly breaking a curfew. The two vehemently deny the allegations and have demanded an apology.
Butler's tough stance appears to have angered some of the locals and the coach tweeted: "advised to stop riding my bike in Terengganu coz i am gonna get attacked".
Goalkeeper Sharbinee exchanged words with Butler as he walked off the pitch, the coach furiously pointing his finger at the player and shoving him in the back for good measure.
Annoyed at being substituted in a match also marred by violent play and a flurry of cards, Sharbinee hurled a water bottle in Butler's direction, earning himself an indefinite ban.
"I'm deeply disappointed with him. It was disgraceful behaviour," said Butler, who has launched a one-man campaign to weed out indiscipline and corruption from Malaysian football.
"What he did was wrong and this isn't the first time he has done it," The Star newspaper quoted him as saying.
"We don't need such players. We only want those who put in an honest effort. I can safely say that he won't feature in the team anymore.
"We must act," the 46-year-old added. "The team can't move forward until we get rid of players who have no regard for discipline or are corrupt.
"If we don't, we will forever be mired in mediocrity with question marks, and suspicion, over our every performance. I knew before the match that something was up."
Butler wasted no time telling Ahmad and Faruqi what he thought of their demand for an apology.
"Why should I apologise? Is it for being honest, having integrity and the courage for standing up against indiscipline? Or for trying to build a strong team?" asked the former West Ham player.
"It wasn't me who broke the rules. In fact, the two players are the ones who should say sorry and beg for forgiveness.
"They have the same attitude as Sharbinee. They will not play for the team as long as I'm here.
"I don't know how long that will be but I intend to clean up the team while I'm still in charge. The players owe it to the fans to try their very best in every match."
Again posting on his Twitter account, Butler promised: "If I get brought down so be it, but I'll go down bringing the pack of cards with me."
Terengganu FA president Che Mat Jusoh backed Butler, suggesting players who did not give 100 per cent should quit the club.
"We can't blame the coach when the players are the problem," he said. "The management will take the necessary action."