This paper attempts to provide a broad overview of foreign workers in Malaysia by examining the nature, contributory factors and consequences of cross-country labor mobility and its economic, social and political consequences. The importation of foreign workers in Malaysia has been a necessity when the country was facing an acute shortage of labor force in its multi-sectoral development activities. Malaysia`s status in international labor migration is somewhat unique because of the presence of a large number of aliens, in particular illegal aliens. Among the factors which facilitated labor migration from major labor exporting countries to Malaysia are unequal development, employment opportunities, and wage rates between countries; increased investment and trade ties; geographical proximity; demographic and cultural factors; and the state`s policy. Coupled with its multi-ethnic social structure the rapid influx of foreign workers has created a number of major issues and implications on the local scenes; economic, social as well as political. Though undeniably the contribution of these workers to rapid economic growth and development of the country is significant, the continued arrivals of foreign labor pose some negative impacts and implications on the local society. In an attempt to minimize the negative ramifications of uncontrolled influx of foreign workers Malaysian government has taken various measures to regulate the inflow of alien labor and weed out the illegals. But the measures have achieved only limited success and the problems of illegal aliens continue to plague the country. In this context, the paper argues that the illegal inflow of aliens will persist unless the government changes its short-sighted opportunistic policies and looks for more profound ways of combating unskilled and semi-skilled labor shortages.