Devotees of yoga and moderate Muslim groups criticised the ruling by Abdul Shukor Husin, chairman of the government-backed National Fatwa Council. Yoga is hugely popular in mostly-Muslim Malaysia.
'I don't think it had caused any Muslim to convert to Hinduism, neither has it weakened their faith,' said Norhayati Kaprawi, an official with Sisters of Islam, a private group which champions the rights of Muslim women.
'It is just an exercise like tai chi, which has its roots in Buddism,' she told the Sunday Star newspaper. She said her group's staff had been holding yoga classes for the past year and that they would continue.
Rulings by the Fatwa Council are not legally binding on the country's Muslims, and there are no laws to punish those who ignore Council decisions, but it is an enormously influential body.
Abdul Shukor decreed that yoga was forbidden because it involves the recitation of mantras and that it encourages a union with God that is considered blasphemy in Islam.
"The practice will erode their faith in the religion," he said on Saturday. "It does not conform with Islam."
A veteran opposition lawmaker, Lim Kit Siang, said that the edict showed that Malaysia was heading towards a conservative type of Islam which could divide the multiracial country.
"It is sending a most unfortunate message that Malaysia, instead of moving towards a moderate and universal Islam, is moving towards an opposite direction which will create divisions," he told AFP.
Islam is the official religion of Malaysia, where more than 60 percent of the population of 27 million are Muslim Malays who practice a conservative brand of the faith.
About 25 percent of the population is ethnic Chinese and eight percent is ethnic Indian, most of whom are Hindus.
Yoga, an ancient Indian aid to meditation dating back thousands of years, is a popular stress-buster in the Malaysian capital Kuala Lumpur.
Muslim yoga teacher Siti Suheila Merican said that while yoga practice should not involve worshipping, the physical movements were good for improving health.
"Worldwide it has been accepted as an excercise for health benefits," she was quoted as saying by the Star newspaper.