Portland Mayor Carralyn Parkes has said she will appeal the decision by the High Court to not move forward with a legal case against the Home Office over the Bibby Stockholm barge.
She challenged the lawfulness of the use of the Bibby Stockholm barge at Portland Port by the Home Office and Home Secretary Suella Braverman.
A judge ruled on Wednesday that Mrs Parkes did not have an arguable case.
Mr Justice Holgate had considered arguments at a High Court hearing in London this week.
Mrs Parkes said: "It is bitterly disappointing but also frightening. This means the Home Secretary can do whatever she pleases anywhere she likes.
"It is not just Portland residents who should be worried, the whole country should be worried.
"I will be appealing and my legal team are working on an appeal now."
As previously reported, the asylum seekers have been told they will be returning to the Bibby Stockholm barge next week.
Mrs Parkes said she thought her court case would have been unlikely to change the outcome for the asylum seekers, even if the case was being taken to Judicial Review.
She said: "I don't think the government would care one way or the other.
"They didn't care that they didn't have fire safety signed off, they didn't care about whether the barge had legionella bacteria, they just moved the asylum seekers on anyway.
"I don't think it would have worried them one bit even if it was declared unlawful, I don't think they would have changed their actions.
"The way they have behaved is disgusting, disgraceful and shameful."
A Home Office spokesperson said: “We welcome the judgment which was in the Home Office's favour.
“We are continuing to progress plans for individuals to return to the barge, with asylum seekers now receiving letters confirming re-embarkation.
“Delivering alternative accommodation sites, such as the Bibby Stockholm vessel, will be more affordable for taxpayers and more manageable for communities, due to healthcare and catering facilities on site, 24/7 security and the purpose built safe accommodation they provide.
"The government recognises that using alternative sites such as vessels involves difficult decisions, but urgent action is needed to reform the broken asylum system and reduce the use of hotels.
"The Bibby Stockholm will help to minimise the impact on the community due to its healthcare and catering facilities on site as well as 24/7 security."
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