The Trump administration has dismissed key officials from the Office of Space Commerce, dealing a major blow to efforts aimed at regulating and coordinating satellite traffic in an increasingly crowded space environment, sources familiar with the development said.

At least a third of the 25-member office, operating under the National Oceanic and Atmospheric Administration (NOAA), were abruptly terminated on Thursday, with employees given just a few hours’ notice before being forced to leave by the end of the day, the sources said.

Among those dismissed was Dmitry Poisik, the head of the Traffic Coordination System for Space.

The layoffs come at a critical juncture for the U.S. space industry, which has long pushed for a dedicated traffic management system to prevent potential satellite collisions.

The affected office has been running a trial system to track and alert operators about possible space debris and spacecraft collisions—an effort originally championed by the Trump administration itself in 2018 through a space policy directive.

One source described the dismissed personnel as "air traffic controllers for space" who play a crucial role in managing satellite congestion. “We are talking about tens of thousands of collision notices, not just a few dozen per year. It’s like a game of chicken up there,” the source said.

The layoffs were part of a broader reduction in force at NOAA, which also saw hundreds of employees let go across various departments.

The agency, which plays a crucial role in weather forecasting and satellite imagery licensing, now faces an uncertain future regarding its space regulatory functions.

Elon Musk’s advocacy for government efficiency has reportedly influenced widespread federal workforce cuts. Musk, whose company SpaceX is at the forefront of commercial space activity, has previously criticized slow-moving regulatory frameworks.

However, industry experts have raised concerns that cutting personnel from the space traffic program could create regulatory confusion and further delay efforts to transfer orbital alerting responsibilities from the Pentagon to the civilian sector.

By Friday, companies seeking licenses for commercial imagery satellites or requiring regulatory guidance were met with an automated response stating that NOAA lawyers would now handle all communications, according to an email seen by Reuters.

“This is a temporary arrangement to address continuity of operations as no senior personnel remain in the office due to ongoing reductions in force,” the email read.

The move is expected to cause significant disruptions in satellite licensing, potentially delaying spacecraft approvals at a time when the U.S. space industry is experiencing rapid growth.

Experts warn that the Federal Aviation Administration (FAA) may struggle to approve rocket payloads without NOAA’s licensing clearance, creating further bottlenecks for space launches.

While NOAA declined to comment on personnel matters, sources within the space industry and government fear that the abrupt firings could weaken the United States’ ability to manage space traffic and ensure the safety of the growing satellite ecosystem.