The new method could also make it difficult or impossible for some immigrants who leave the country in hopes of gaining a green card to return.
The USCIS policy memo states that people such as students, temporary workers or people on tourist visas need to go through the Department of State from outside of the US.
“When aliens apply from their home country, it reduces the need to find and remove those who decide to slip into the shadows and remain in the US illegally after being denied residency,” USCIS said, making the system “fairer and more efficient”.
On X, the Department of Homeland Security, which oversees USCIS, said: “The era of abusing our nation’s immigration system is over.”
“We’re returning to the original intent of the law to ensure aliens navigate our nation’s immigration system properly,” USCIS Spokesman Zach Kahler said.
“From now on, an alien who is in the US temporarily and wants a green card must return to their home country to apply, except in extraordinary circumstances,” he continued.
Kahler said the policy allows the immigration system “to function as the law intended instead of incentivising loopholes” and that visits “should not function as the first step in the green gard process”.
It is unclear whether pending green card applications will be affected.
A spokesperson for the USCIS told the BBC that as the policy is rolled out, “people who present applications that provide an economic benefit or otherwise are in the national interest will likely be able to continue on their current path”.
“Others may be asked to apply abroad depending on individualised circumstances,” it said.
Being a green card holder, or lawful permanent resident, allows a person to live and work permanently in the US. Obtaining one is a multi-step process that can take months to several years.
There are currently more than a million legal immigrants waiting for approval on their adjustment of status green card applications, according to the Cato Institute’s director of immigration studies.
Kahler argued that following the law allows the majority of cases to be handled by the US State Department at consular offices abroad and frees up USCIS resources to focus on processing other cases that fall under its purview – such as visas for victims of violent crime and human trafficking, naturalisation applications, and other priorities.
The move is consistent with longstanding immigration law and immigration court decisions, the agency said. Immigration officers are being directed to “consider all relevant factors and information on a case-by-case basis when determining whether an alien warrants this extraordinary form of relief”.
Michael Valverde, who was a senior official at USCIS under both Republican and Democratic administrations until his departure last year, said to the BBC’s US media partner CBS that Friday’s announcement would “disrupt the plans of hundreds of thousands of families and employers annually”.
“This is a largely unprecedented move that will limit lawful immigration to the US greatly,” Valverde said. “People who followed the rules faithfully now face tremendous uncertainty.”