"President Obama should abandon his lawless executive amnesty program and start enforcing the law today," Texas Gov. Greg Abbott said in a news release.
The administration could ask for a re-hearing by the full 5th Circuit but the National Immigration Law Center, and advocacy group, urged an immediate Supreme Court appeal.
"The most directly impacted are the 5 million U.S. citizen children whose parents would be eligible for temporary relief from deportation," Marielena Hincapie, executive director of the organization, said in a news release.
The Justice Department said in a statement that it disagreed with the court's ruling, claiming that Obama's action would "allow DHS to bring greater accountability to our immigration system by prioritizing the removal of the worst offenders, not people who have long ties to the United States and who are raising American children." The statement did not specify what the department's next steps would be.
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.
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.
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