South Sudan's government has issued an order to non-governmental organisations (NG0s) and private firms to fire certain foreign workers by mid-October.
The labour ministry says roles ranging from receptionist to executive director should in future be filled by South Sudanese nationals.
The charity Oxfam says the move will have a huge impact on aid programmes.
Nearly two million people have fled their homes since two factions of the ruling party fell out in December.
Thousands of people have died in the fighting and aid agencies say up to four million people are at risk of food shortages because of the crisis.
What started as a political dispute between President Salva Kiir and his former deputy Riek Machar has escalated into ethnic violence.
'Tip into famine'The BBC's Denis Okari in neighbouring Kenya says the move could affect thousands of foreign workers and comes at a critical time for the world's newest nation.
"South Sudan is on a knife-edge and could easily tip into famine in 2015 - even though the aid effort here is huge, it is not reaching many of the people who desperately need help," Tariq Riebl, director of Oxfam in South Sudan, told the BBC in a statement.
"We need to be expanding aid programmes in South Sudan, not restricting them," he said.
The dispute that began in December escalated into ethnic fighting "The government of South Sudan and the international community need to work together to ensure that life-saving aid reaches the people who need it."
Oxfam said the vast majority of its staff in the country were South Sudanese but there were "many foreigners in key roles".
The circular from the ministry of labour lists nine roles - executive directors, personnel managers, secretaries, human relations officers, public relation officers, procurement officers, front desk officers, protocol officers and receptionists - that have to be filled by "competent South Sudanese nationals" from 15 October.
Helen Achiro Lotara, the under secretary at the labour ministry, told the BBC the aim was to ensure that 80% of managerial-level positions were held by locals.
She said all NGOs and private companies - including hotels and oil firms - should take the order seriously.
South Sudan, which gained independence from Sudan in July 2011, is rich in oil, but following decades of civil war it one of the least developed regions on earth.
Fighting erupted in the South Sudan capital, Juba, in December 2013. It followed a political power struggle between President Salva Kiir and his ex-deputy Riek Machar. The squabble has taken on an ethnic dimension as politicians' political bases are often ethnic. 
Sudan's arid north is mainly home to Arabic-speaking Muslims. But in South Sudan there is no dominant culture. The Dinkas and the Nuers are the largest of more than 200 ethnic groups, each with its own languages and traditional beliefs, alongside Christianity and Islam. 
Both Sudan and the South are reliant on oil revenue, which accounts for 98% of South Sudan's budget. They have fiercely disagreed over how to divide the oil wealth of the former united state - at one time production was shutdown for more than a year. Some 75% of the oil lies in the South but all the pipelines run north. 
The two Sudans are very different geographically. The great divide is visible even from space, as this Nasa satellite image shows. The northern states are a blanket of desert, broken only by the fertile Nile corridor. South Sudan is covered by green swathes of grassland, swamps and tropical forest. 
After gaining independence in 2011, South Sudan is the world's newest country - and one of its poorest. Figures from 2010 show some 69% of households now have access to clean water - up from 48% in 2006. However, just 2% of households have water on the premises. 
Just 29% of children attend primary school in South Sudan - however, this is also an improvement on the 16% recorded in 2006. About 32% of primary-age boys attend, while just 25% of girls do. Overall, 64% of children who begin primary school reach the last grade. 
Almost 28% of children under the age of five in South Sudan are moderately or severely underweight. This compares with the 33% recorded in 2006. Unity state has the highest proportion of children suffering malnourishment (46%), while Central Equatoria has the lowest (17%). South Sudan bans foreign workers
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