The UK government has “lost control” of the asylum system, a councillor has warned.
On Friday, Carmarthenshire council failed in a High Court bid to stop Stradey Park Hotel, in Llanelli, being used to house up to 241 asylum seekers.
According to a councillor, the Home Office has been “completely unable” to tell locals what is happening.
The Home Office said the plans were necessary and that the asylum system was under “incredible” strain.
Dozens of protesters gathered outside the hotel on Saturday.
These included a group of local residents and representatives from organisations expressing their continued concerns about the effect of the move.
Pro-refugee groups also gathered with banners.
A former race equality commissioner said more work needs to be done with local people to allay “irritational fears” and “address legitimate ones”.
Llanelli MP Dame Nia Griffith called for more international work to find “solutions that will last”.
“My plea would be with the UK government to get a grip on an asylum system, which they have clearly lost the grip of,” councillor Martyn Palfreman told BBC Radio Wales Breakfast.
“In terms of what happens next and the asylum seekers arrival in Llanelli, the honest answer is I don’t know.”
“We’ve been told previously they will be arriving next week, we don’t know any more details in terms of the composition of the group that will be arriving or exactly when they will be arriving,” added Mr Palfreman.
The Labour councillor for the Hengoed ward of Llanelli added that his “real concern” is that the asylum seekers themselves will have anger directed towards them, which he said he hopes “doesn’t happen”.
Dame Nia Griffith, MP for Lanelli, said she was very “very disappointed” with the outcome of Friday’s hearing.
“I think it’s particularly upsetting for the residents who live closely to the hotel and whilst people have a right to their opinion I would actually beg them to be very considerate,” she said.
“We need to work together with other countries to find solutions that will last… there has to be a really concerted effort to work internationally with partners so there are proper agreements.”
Following Friday’s hearing, council leader Darren Price said he was “disappointed” and that the authority would consider the judge’s reasons on Monday.
Aled Edwards, the former commissioner for racial equality in Wales, said a conversation was needed with people in the community to allay “irrational fears” and “address legitimate ones”.
“If we spend the time explaining to people what people’s backgrounds are, what they can offer us, what they can bring us… I think it could become much better,” he said.
“But there is a toxicity to the debate around the globe that is not good.”
The Home Office said the number of people arriving in the UK in need of accommodation had reached record levels.
“The Home Office is committed to making every effort to reduce hotel use and limit the burden on the taxpayer,” a spokesman said.