The Egyptian authorities have banned the Muslim Brotherhood, sealing the marginalisation of the Islamist movement that was the country's most powerful political group until as recently as the July overthrow of Mohamed Morsi.

A court on Monday ordered the freezing of the Brotherhood's assets and also banned its spin-off groups, state media reported.

In practice, the group had almost been forced underground already by the arrest this summer of thousands of its members – including most of its leaders – and the killing of about 1,000 more.

It is a familiar predicament for the Brotherhood, which has been banned for most of its 85-year history and has successfully fought off every threat to its existence.

Originally banned under Gamal Abdel Nasser, it was tacitly tolerated under his successor, Anwar Sadat. During the last years of Hosni Mubarak's regime, several of its members were allowed to be elected to parliament in an independent capacity.

"I don't think it will have an effect," Ahmed Ragheb, a pro-Morsi activist close to several leading Brotherhood members, said of the new ban.

"People think the Brotherhood can be dissolved through governmental decisions. But it has existed for 85 years and survived far worse."

The group's London-based spokesman, Abdullah al-Haddad, tweeted: "The Muslim Brotherhood are part and parcel of Egyptian society. Corrupt illegitimate judicial decisions cannot change that … [The Muslim Brotherhood] will continue to be present on the ground: they cannot kill an idea, they tried before and failed – they are trying again and they will fail."

Brotherhood members who remain at liberty say that the arbitrary arrests and state-led killings of their colleagues remain a far more serious threat to the organisation's operational capacity.

Only a handful of senior Brothers dare live in the open, and two recently told the Guardian that they were unsure of who was now in charge of the group, following the arrest of its leader, Mohamed Badie, and his deputies.

Young members say this breakdown in communication has made the group more fragmented, and also finally given them the chance to have more say in the activities of the group, which is usually highly hierarchical.

"Now the youth are just by themselves," said Ragheb. "And they work together far better than when the leaders are involved. Now that the leadership is gone, no one needs to ask permission for anything any more."

In an example of the Brotherhood's current organisational chaos, a group of younger members spent over two months drafting an apology for some of the mistakes the movement made during the post-Mubarak period. But when the statement was released on a Brotherhood-linked website, one of the remaining Brotherhood leaders instantly ordered its removal, claiming it did not represent the group.

Ragheb said this had frustrated young members but claimed they still wanted to remain part of the group. "No one is going to leave. But it's going to get more revolutionary," he argued.

Thought to number between 300,000 and 1 million members, the Brotherhood remains highly unpopular among much of the rest of Egypt's population of 85 million, who blame the group for trying to grab too much power following Morsi's election in 2012.