On 26 May 2011 a 5-3 decision of the U.S. Supreme Court upheld an Arizona law (the Legal Arizona Workers Act) rejecting the claims by business and civil rights groups that the law intrudes upon federal immigration policy. Chamber of Commerce of the United States of America et al v. Whiting et al 131 S. Ct. 1968 (2011). The Legal Arizona Workers Act provides that the licenses of state employers who knowingly or intentionally employ unauthorized aliens may be, and in certain circumstances must be, suspended or revoked. Additionally, the law requires that all Arizona employers use E-Verify, the internet-based system created by Congress that assists employers in verifying their employees' work authorization.

The Supreme Court found that the Arizona law does not impermissibly preempt the federal Immigration Reform and Control Act, despite the Arizona law's imposition of more onerous penalties than the federal law for hiring unlawful alien workers. The federal law prohibits state and local governments from enforcing any law that imposes punishment on employers who hire unlawful aliens, making an exception for punishment imposed by licensing and similar laws. Here, the Supreme Court reads the federal law's "licensing or similar laws" exception broadly, leaving room for state governments to legislate on immigration issues and provide greater restrictions and punishments on the state level. Additionally, the court upholds the Arizona E-Verify mandate, finding that the federal law which sets up E-Verify does not circumscribe state action and highlighting the federal government's consistent usage and expansion of E-Verify. Notably, Chief Justice Roberts writes in the majority opinion that the states and the federal government work together to make immigration law, signaling the court's opinion that lawmaking jurisdiction in the immigration context is shared between the federal government and the states.