By Aileen Graef and Isabelle D’Antonio

(CNN) — The Department of Education sent a “Dear Colleague” letter Friday threatening the federal funding of any academic institution that considers race in most aspects of student life.

The letter — geared toward all preschool, elementary, secondary and postsecondary educational institutions, as well as state educational agencies that receive financial assistance from the federal government — laid out a sweeping and controversial interpretation of federal law following the 2023 Supreme Court decision that gutted affirmative action. It’s almost certain to draw legal challenges.

“Federal law thus prohibits covered entities from using race in decisions pertaining to admissions, hiring, promotion, compensation, financial aid, scholarships, prizes, administrative support, discipline, housing, graduation ceremonies, and all other aspects of student, academic, and campus life,” wrote Craig Trainor, acting assistant secretary for civil rights for the Education Department.

The Supreme Court’s landmark 6-3 decision in Students for Fair Admissions v. Harvard overturned long-standing precedent that has benefited Black and Latino students in higher education. Donald Trump, at that time the former president, called it a “great day for America.”

Trainor said that although the 2023 decision “addressed admissions decisions, the Supreme Court’s holding applies more broadly. At its core, the test is simple: If an educational institution treats a person of one race differently than it treats another person because of that person’s race, the educational institution violates the law.”

This interpretation could open a wide range of challenges to courses and literature taught in schools, scholarships for non-White students, and various student organizations, including Black fraternities and sororities.

“Race-based decision-making, no matter the form, remains impermissible. For example, a school may not use students’ personal essays, writing samples, participation in extracurriculars, or other cues as a means of determining or predicting a student’s race and favoring or disfavoring such students,” the letter read.

The letter says the department will “take appropriate measures to assess compliance with the applicable statutes and regulations based on the understanding embodied in this letter” no later than February 28.

It also criticized diversity, equity and inclusion efforts, known as DEI, saying that such programs “frequently preference certain racial groups and teach students that certain racial groups bear unique moral burdens that others do not.”

The letter comes as Trump has waged war on DEI efforts, signing an executive order hours after his swearing-in that bans DEI considerations in federal hiring. Dozens of employees at the Education Department were placed on paid administrative leave last month as part of the Trump administration’s larger effort to rid the federal workforce of employees associated with DEI efforts, two sources familiar with the move told CNN.

The American Federation of Teachers criticized the memo, calling it illegal and saying federal law “prohibits any president from telling schools and colleges what to teach.”

Educators “ensure all students gain the knowledge and experiences they need to navigate a diverse and complex world. And we teach critical thinking skills, which necessarily requires us to present history in an open and honest way, to answer students’ questions and better meet their needs,” the union’s president, Randi Weingarten, said in a statement. “This memo does the opposite — it makes it far harder to do our jobs and will only stoke division and fear.”

The letter also comes as the Trump administration has begun drafting an executive order that would kick off the process of eliminating the Department of Education, one of his campaign promises.

On the campaign trail, Trump repeatedly pointed to the department as a sign of federal overreach and tied it to culture war issues. “We will drain the government education swamp and stop the abuse of your taxpayer dollars to indoctrinate America’s youth with all sorts of things that you don’t want to have our youth hearing,” he said.

This story has been updated with additional information.

CNN’s Rene Marsh contributed to this report.

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