Roscommon County Council has refused plans to extend Ballaghaderreen's Eroc centre.
The Abbeyfield Hotel in Ballaghaderreen has been an emergency reception and orientation centre for refugees for over eight years.
Next Week and Company wanted to extend it, with 18 extra bedrooms.
Planning consultants, acting for Next Week and Co, said there are currently 192 people living in the existing facility - including 101 adults and 91 children.
They said the maximum number would increase to 310 if the extension got the go-ahead.
But the council has this evening turned down the planning application to extend it.