The Israeli Ministry of Interior has stopped granting work visas to foreigners who work for aid agencies in the Palestinian Territories and East Jerusalem.
But in recent months foreign staffers for organizations like Oxfam, Save the Children and Doctors without Borders have been denied proper visas by Israeli authorities. Instead they are getting tourist visas which do not permit the holder to work and only last three months.
The head of Doctors Without Borders in Jerusalem Jean-Luc Lambert told the London Times, "We are now in a very precarious legal position. We can't get B1 visas (work visas) only tourist visas and with this it is not permitted for us to work."
Since Israel took over the Palestinian Territories including East Jerusalem in 1967, aid workers have been given year-long work visas and have been able to use them in occupied areas.
Aid workers fear this new restriction is intended to limit their access to Palestinian areas particularly in contested East Jerusalem and those parts of the West Bank which are officially under full Israeli control.
Katherine Weibal from Oxfam told ABC News today that Israeli authorities stopped handing out work visas in autumn 2009.
Several of her organization's 22 foreign staffers are now living precariously on tourist visas. She said different Israeli officials have told staff different stories about the practical implications.
"Some staff have been told they can work, others that they cannot. Some of our colleagues here are even married to local people and they worry that they might not be allowed back into the country," she said.
Although no Oxfam workers have yet encountered serious problems, at least one foreigner working for Worldvision and issued with a tourist visa, was recently denied entry to Israel.
Martha Myers, country director for CARE and leader of the Association for International Development Agencies in Jerusalem, told ABC News Israel is intentionally making it difficult for the aid organizations to work in Jerusalem in particular.
"The Israelis want to assert full control over all of Jerusalem. As part of their consolidation they do not want international organizations that help Palestinians maintain their lives in the city," she said.
The Israeli Ministry of the Interior issued a statement: "The matter is under intense discussions, with the active participation of the relevant military authorities, with a view to finding the right and appropriate solution as soon as possible."
Yigal Palmor a senior spokesman for the Israeli foreign ministry told ABC News the current problems "are in no way part of an intentional strategy to expel foreign aid workers."
"There is however a new policy to restrict the numbers of foreign workers in Israel, but this is not designed to target the humanitarian organizations," he said. "The treatment of these people has been inconsistent in recent months and we are trying to make it better."