This article has been updated.
NEW ORLEANS — President Barack Obama's plan to protect from deportation an estimated 5 million people living in the United States illegally suffered another setback Monday in a ruling from a New Orleans-based federal appeals court.
In a 2-1 ruling, the 5th U.S. Circuit Court of Appeals upheld a Texas-based federal judge's injunction blocking the administration's immigration initiative.
Republicans had criticized the plan as an illegal executive overreach when Obama announced it last November. Twenty-six states challenged the plan in court.
On Tuesday, the Justice Department said it would ask the Supreme Court to hear the case, Reuters reported.
The administration argued that the executive branch was within its rights in deciding to defer deportation of selected groups of immigrants, including children who were brought to the U.S. illegally.
Texas Gov. Greg Abbott was praised the ruling.
"President Obama should abandon his lawless executive amnesty program and start enforcing the law today," Abbott said in a news release.
The ruling further dims prospects of implementation of the executive action before Obama leaves office in 2017. Appeals over the injunction could take months and, depending on how the case unfolds, it could go back to the Texas federal court for more proceedings.
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Part of the initiative included expansion of a program called Deferred Action for Childhood Arrivals, protecting young immigrants from deportation if they were brought to the U.S. illegally as children. The other major part, Deferred Action for Parents of Americans, would extend deportation protections to parents of U.S. citizens and permanent residents who have been in the country for years.
The 70-page majority opinion by Judge Jerry Smith, joined by Jennifer Walker Elrod, rejected administration arguments that the district judge abused his discretion with a nationwide order and that the states lacked standing to challenge Obama's executive orders.
They acknowledged an argument that an adverse ruling would discourage potential beneficiaries of the plan from cooperating with law enforcement authorities or paying taxes. "But those are burdens that Congress knowingly created, and it is not our place to second-guess those decisions," Smith wrote.
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In a 53-page dissent, Judge Carolyn Dineen King said the administration was within the law, casting the decision to defer action on some deportations as "quintessential exercises of prosecutorial discretion," and noting that the Department of Homeland Security has limited resources.
"Although there are approximately 11.3 million removable aliens in this country today, for the last several years Congress has provided the Department of Homeland Security with only enough resources to remove approximately 400,000 of those aliens per year," King wrote.
—Reuters contributed reporting to this post.