Foreign workers are being shut out of Malaysia's struggling eocnomy
The Malaysian government has revoked the work visas of tens of thousands of Bangladeshis after protesters said jobs should be kept for Malaysians.
The Bangladeshis had already been approved for work in Malaysia and had paid M$12,000 ($3,226, £2,357) in fees.
The government said it would try to refund the fees.
Malaysians have become increasingly concerned about the impact the worldwide financial turmoil is having on their livelihood.
Home Minister Syed Hamid Albar said Bangladeshi workers who had visas approved in 2007 but who had not yet arrived in Malaysia would not be allowed to take up employment there.
"This is due to the current scenario in the country, in that there is no need for foreign labour except for certain sectors identified by the government," he told a news conference on Tuesday, according to state news agency Bernama.
"We will do everything possible to ensure they get a refund of the money they paid," he added.
Bangladeshi officials expressed shock at the decision, but the country's acting high commissioner in Kuala Lumpur, Waisuzzaman, said he was hopeful the Malaysian government might change its mind.
Foreign workers usually work in jobs seen as dirty, dangerous or difficult
"I met the home secretary - he assured us they would reconsider the whole thing," Mr Waisuzzaman told the BBC. "I guess this is not the final decision from the Malaysian government."
The BBC's Mark Dummett in Dhaka says 5.5 million Bangladeshis live and work abroad, sending home more than $9bn last year.
He says the Malaysian move could be a sign of worrying times ahead, and ministers have asked Malaysia to reconsider its decision.
Observers say the Malaysian decision could have major repercussions for foreign workers in the country, many of whom are from South Asia.
Last week, Talat Mahmud Khan of the Bangladeshi high commission sparked uproar in Malaysia when he revealed that about 70,000 of his compatriots had received visas.
The Malaysian Trades Union Congress (MTUC) led protests, saying the situation for Malaysians was bleak enough without more foreign workers being brought in.
"More workers are calling us to report that they are facing retrenchment, their working hours reduced and their overtimes slashed," MTUC Vice-President A Balasubramaniam said.
In January, the government banned the hiring of new foreigners after a report forecast 45,000 Malaysians losing their jobs in the next few months.
Estimates suggest that about 500,000 Bangladeshis are among up to three million Asian migrant workers in Malaysia, both legal and illegal.
Immigration authorities regularly announce campaigns to expel illegal workers.
They use the People's Volunteer Corps, alongside police on searches, a practice which has led to accusations of rights abuse.
Foreign workers in Malaysia include Bangladeshis, Indonesians, Pakistanis, Indians, Nepalese and Burmese nationals. Filipinos also enter Malaysia on Borneo, through Sabah.