More than 100,000 workers from neighbouring Indonesia alone have entered the country on tourist visas since January, an immigration department source has said.
That was when Malaysia was gearing up for a massive crackdown on illegal labour.
The crackdown followed an immigration amnesty, during which about 400,000 illegal foreign workers quit Malaysia in return for freedom from prosecution as illegal immigrants, but the exodus caused some acute shortages of unskilled labour.
Many of those who left under the amnesty, mostly Indonesians, simply returned under a tourist visa to reclaim their old jobs.
"For now, they can register with us and they will be accepted as legal workers so long as their fingerprints are in our system," Home Affairs Minister Azmi Khalid told reporters.
Malaysia's immigration department also offered on Wednesday work permits to illegal workers who had overstayed their tourist visas, although only to people who left under the amnesty and returned.
"I want to make clear however that only those who had registered their return during the amnesty will be given the privilege," Azmi said.