Photos from today show steel cables and a large notice on the entrance to the Vivemar Hotel on the Costa del Sol saying 'precintado' or 'sealed off' in English.
Around 200 guests staying at the hotel in the popular resort of Benalmadena Costa are now having to exit the establishment via a ground-floor garage.
It is the latest development in a backlash against tourism in Spain that also saw furious protesters take to the streets of Mallorca and Ibiza at the weekend.
A spokesperson for the local town hall said it had instructed police to seal off the front entrance to the hotel after it failed to see it listed in the official tourist accommodation register.
Raul Campos told local paper Sur: 'We have asked in the Junta de Andalucia's Tourism Department and they say the company that operates the hotel is not in the official register.
'That means it can't be officially opened as it does not have the proper documentation.'
He went on to insist council officials had warned the hotel management about today's police action at the end of March.
Manager Alberto Tusquellas, who a hotel receptionist said this evening was in meetings and unavailable, has blamed things on a 'red tape' hiccup.
He told local press a Spanish firm called Vive Resort Management SL began operating the hotel around a year ago with a sublease agreement using a previous operator's registration number.
However, Mr Tusquellas said this had now been revoked because of a bureaucratic problem they were trying to fix.
The hotel operator's version of events has been contradicted by the building's owners who said the sublease was the subject of ongoing civil and criminal court action after they discovered the company they had signed a contract with to run the hotel had agreed to sublet it to another firm without their knowledge.
The claim of the owner, identified locally as María Jose García Vargas, could not be independently verified on Tuesday night.
A receptionist at the hotel, which used to be called the Vistamar Hotel, said this evening: 'I'm a bit rushed off my feet at the moment to check where our clients are from but I'd say there would be because we've got a bit of everything.