A US federal appeals court panel has ruled that US President Donald Trump cannot use an 18th century wartime law to speed the deportations of people his administration accuses of membership in a Venezuelan gang, blocking a signature administration push that is destined for a final showdown at America's Supreme Court.

A three-judge panel of the 5th US Circuit Court of Appeals, one of the most conservative federal appeals courts in the country, agreed in a 2-1 decision with immigrant rights lawyers and lower court judges who argued the Alien Enemies Act of 1798 was not intended to be used against gangs like Tren de Aragua, the Venezuelan group Trump targeted in his March invocation.

Lee Gelernt, who argued the case for the ACLU, said on Tuesday that “the Trump administration’s use of a wartime statute during peacetime to regulate immigration was rightly shut down by the court."

"This is a critically important decision reining in the administration’s view that it can simply declare an emergency without any oversight by the courts,” he added.

It's the latest court setback for the Trump administration on an issue that the White House has made a top priority.

On Sunday, a US judge at least temporarily blocked the government from deporting a group of Guatemalan children who had crossed the border without their families, after their lawyers said the youngsters were loaded onto planes overnight and in violation of laws affording protections for migrant kids. (AP)