Mexico is to make a formal complaint to the US over tough new immigration measures signed into law by President George W Bush on Wednesday.
Thousands of illegal immigrants cross into the US every year
The new law will allow a border fence to be completed in the Californian city of San Diego to deter illegal migrants.
It also makes it harder for people living illegally in the US to obtain driving licences.
Mexico's President Vicente Fox and Interior Minister Santiago Creel have said it will harm bilateral relations.
Millions of Mexicans live in the US, many of them without legal documentation, and Mr Fox said it was his duty to defend them.
He said Mexico would make "a firm and formal complaint against the option that has nothing to do with the harmonious development of relations between the US and Mexico".
Mr Creel, who announced on Thursday that he would seek to succeed Mr Fox as president, said the new law was "overly extreme".
The interior minister added that Mexico had given assistance to the Washington in stopping Central Americans crossing its territory to enter the US and had received "absolutely nothing" in return.
Many Republicans in the US Congress have been pressing for a clampdown on illegal immigration since the 11 September 2001 attacks. They argue that poor security on the Mexican border could be used by terrorist groups to move their members into the US.
Senior Mexican and US officials met in January to discuss border security and a proposed immigration deal.
The two failed to make progress on a programme to give Mexicans a right to work temporarily in the US.