Lilongwe city council has given refugees 90 days to fold up their businesses in the city and relocate to Dzaleka refugee camp in Dowa.
Lilongwe city council chief executive officer John Chome said this has been arrived at after intense consultations with the refugees leadership.
Refugees, especially from Burundi and Rwanda run various businesses, including running hawkers, in townships as well as key trading centres in the city.
A grouping calling itself concerned Malawians have since warned that it will take drastic action if the refugees fail to leave their businesses in the city.
The grouping chairperson Symon Macmillan said the refugees are stifling Malawian businesses.