Stephanie Noble moved Grey Lady Too into her living room in Back, on the Isle of Lewis, in December 2011 after a dispute over its grazing area.
She said there was nowhere else suitable for the pony and was concerned for her safety.
Western Isles Council issued Ms Noble with an animal care notice last year, saying alterations were required to door widths and roof space in order to keep the pony indoors.
The council said Grey Lady Too was removed from the property by animal welfare officers.
A council spokesman said: "In the interests of animal welfare we took possession of a pony from the Back area of Lewis. This action was taken after numerous animal health interventions and following a vet certifying that the pony was likely to suffer if its circumstances did not change."
The council said it is seeking a court order "to allow us to make more suitable provisions for the future of the pony".