After hotels began to ask burkini clad guests to leave the premises, the tourism ministry stepped in to allow the swimwear.
But the ministry has since backtracked on the edict, and confirmed it is legal for the nation’s resorts to decide if they will or won’t ban the outfit.
Head of the Chamber of Red Sea Hotel Facilities Ali al-Halawany said the initial overruling of resorts was a step too far from the government.
After the initial repeal officials said they were attempting to ensure there was no religious discrimination in the decisions of holiday resorts.
But less than 24 hours later officials from the Egyptian Hotel Association said the repeal was not binding, and resorts should be allowed to make their own decisions over fears the materials used to make burkinis could pose a health and safety risk.
Critics have decried the move as discriminatory, with many who wear the swimsuit pointing out it is made of the same material as other beachwear.
Burkinis were briefly banned on beaches across France last year following the deadly truck attack in Nice which killed 86 and injured 458 amid a wave of backlash against French Muslims.
But the ban was later repealed by the nation’s highest court, who ruled the enforcement was a violation of women’s fundamental liberties.
In the ruling three top judges said the ban “has dealt a serious and clearly illegal blow to fundamental liberties such as the freedom of movement, freedom of conscience and personal liberty”.
And they found no evidence a risk to public order was being called by “the outfits worn by some people to go swimming”.
The ban was challenged by the Human Rights League (LDH) and Collective Against Islamophobia in France (CCIF), who brought the case before the State Council.
An LDH spokesperson approved of the ruling but said it would not fix the “ridiculous debate that has made France the laughing stock of the world”.
They added: “What is at stake here is the division of the men and women who live in France by their origin and religion.
“We reject this vision of France.”
The CCIF added at the time: “This victory has a strong symbolic resonance that will put an end to the onslaught of stigmatising and Draconian political statements.”