Councillor Ahmed is understood to have been forced to resign after losing a vote of no confidence at the end of a party meeting on Thursday night.
The group has not officially confirmed the news and Coun Ahmed, who had led the Opposition since 2014, is yet to comment.
But multiple sources have told the Local Democracy Reporting Service that there was robust debate during a tense gathering at the party's local HQ.
Coun Ahmed is then understood to have lost a secret ballot on his leadership by a majority vote, though the exact numbers are unclear.
The reasons behind the coup have not been publicly explained either, though it's thought a section of the group felt he was underperforming as leader.
Allies of Coun Ahmed are believed to have disputed that notion.
The move comes just two months after the party recorded its best local election results in Wakefield for several years, taking six seats from Labour.
The Tories now hold 17 of the council's 63 seats. Labour, as the majority ruling party, have 43.
A new leader is expected to be elected within the next couple of weeks.
Local Democracy Reporting Service