By Michael Doyle and Franco Ordonez

The Obama administration suffered another immigration setback Tuesday, as a divided federal appeals court declined to lift a injunction imposed by a Texas-based trial judge.

The 2-1 decision by the 5th U.S. Circuit Court of Appeals means President Barack Obama's executive action deferring deportation of certain immigrants will remain stalled in court for the foreseeable future. It also could force officials to make some tough legal and political choices.

"The public interest favors maintenance of the injunction," Judge Jerry E. Smith stated in the appellate court's 42-page majority opinion.

The 2012 Deferred Action for Childhood Arrivals program stopped deportation proceedings against certain immigrants who had arrived illegally in the United States before age 16. A 2014 expansion added more immigrants, including parents of U.S. citizens. Taken together, the actions could shield more than 4 million immigrants from deportation.

Critics call the program an amnesty and say it exceeds the president's authority. Supporters say it simply exercises prosecutorial discretion and argue that the challengers lack the legal standing to be in court.

In February, addressing a challenge brought by Texas and 25 other states, a Brownsville, Texas-based federal judge appointed by President George W. Bush issued a preliminary injunction temporarily blocking the expanded deferred-deportation program announced last year.

In the decision issued Tuesday, the appellate court agreed with Texas that the deferred action policy known as DAPA imposed a serious burden on the state, and that Texas and the other states challenging the policy had a substantial likelihood of ultimately winning their legal case.

"DAPA modifies substantive rights and interests, conferring lawful presence on 500,000 illegal aliens in Texas (forcing) the state to choose between spending millions of dollars to subsidize driver's licenses and changing its law," Smith wrote.

Smith pointedly added that "although prosecutorial discretion is broad, it is not unfettered."

Smith was appointed to the appellate court by President Ronald Reagan. Judge Jennifer Elrod, who sided with Smith, was appointed by President George W. Bush. Judge Stephen A. Higginson dissented and sided with Obama, the president who appointed him.

"I would hold that the underlying issue presented to us _ the order in which non-citizens without documentation must be removed from the United States _ must be decided, presently is being decided, and always has been decided, by the federal political branches," Higginson wrote.

The Obama administration now must decide whether to ask the entire 5th Circuit to review the case or to seek review by the conservative-dominated Supreme Court, or to take some other step.

Marielena Hincapie, executive director of the National Immigration Law Center, urged the Justice Department to "continue its efforts to get this injunction lifted by bringing the matter before the Supreme Court without delay."

A request that the Supreme Court lift the injunction, and thereby let the Obama immigration policy take effect while the full appeal runs its course, would first go to Justice Antonin Scalia, who oversees the 5th Circuit. On such a big issue, Scalia would likely refer the matter to the other eight justices for a decision.

Any decision could push the issue into the 2016 presidential campaign spotlight.

A renewed immigration debate could prove particularly sticky for Republican presidential contenders Marco Rubio and Jeb Bush, who is expected to soon declare his presidential candidacy. Both have tried to walk a fine line between pushing for stronger border security while backing legal status to nearly 11 million people who are already in the country illegally.

Immigration rights groups were disappointed with the court ruling but expressed confidence that ultimately the executive actions would be upheld.

"We always knew that the fight for immigration reform was not going to be easy and that there would be bumps along the way. But the president's immigration action stands on the right side of history," said Rocio Saenz, international executive vice president for the Service Employees International Union International.

A District of Columbia-based appellate court has heard oral arguments in a separate but related challenge to the Obama immigration policy but has not yet rendered a decision.

(c)2015 McClatchy Washington Bureau