Karen Tumlin, legal director of the National Immigration Law Center, wrote on Twitter that Monday's ruling was "devastating news".
But she added: "It's important to remember that the Supreme Court has NOT addressed the legal merits of the latest Muslim Ban nor the human impacts w/its order today."
"The fight continues."
How have Trump travel bans fared?
The president's travel bans have each been frustrated by the courts to some degree:
In January, he signed an order banning people from seven Muslim-majority countries for 90 days and suspending all refugee entry. The measure, which also banned Syrian refugees indefinitely, prompted protests and multiple legal challenges
A revised version in March removed Iraq from the list and lifted the indefinite ban on Syrian refugees. It also exempted green card holders and dual citizens. By June, the Supreme Court allowed most of it to go into effect, including a 120-day ban on all refugees entering the US, but granted a wide exemption for those with a "bona fide connection" to the US
President Trump's third order was announced in late September. It added non-Muslim-majority nations North Korea and Venezuela, provisions which lower courts have allowed to proceed
What have lower courts said?
In striking it down, federal judges have cited Mr Trump's campaign description of his policy as a "Muslim ban" and his call for "a total and complete shutdown of Muslims entering the United States".
Lower courts have also found the president's policy violated the first amendment of the US constitution covering freedom of religion.
In October, a Maryland federal judge said: "The 'initial' announcement of the Muslim ban, offered repeatedly and explicitly through President Trump's own statements, forcefully and persuasively expressed his purpose in unequivocal terms."
A federal judge in Hawaii said the administration "lacks sufficient findings that the entry of more than 150 million nationals from six specified countries would be 'detrimental to the interests of the United States'".
A court in Virginia ruled: "The illogic of the government's contentions is palpable. The notion that one can demonstrate animus toward any group of people only by targeting all of them at once is fundamentally flawed," the court ruling said, pointing out that the countries' populations were between 90% and 99% Muslim.