WIDGEE Engineering has been given two years to move or close down.
The 25-year-old business that has employed up to 50 people at times, had its material change of use application refused by Gympie Regional Council in yesterday's ordinary meeting during a sometimes emotional debate.
Planning director Gina Vereker told the council that while Widgee Engineering was a well established business, it had grown considerably "without council's approval".
While the council could impose numerous conditions on the business for it to keep operating, when combined it would be impossible for the business to run.
Voting to refuse the application Cr Mark McDonald said the issue was crystal clear.
"We have a high impact business industry being operated in a rural zone," he said.
"It begins and ends there."
Do you agree with the council's decision to refuse Widgee Engineering's development application?
While he said he did not want to read in The Gympie Times that council was shutting down jobs, Cr Hilary Smerdon said that was exactly what the council's vote meant.
"I'm sorry to say if we close the business you will have headlines," he said.
Of 60 submissions received about the business, "90% were in favour" and only one complaint had been made.
The business had also spent about $500,000 to comply with regulations and keep running.
"They're prepared to work in the conditions and we're still going to shut it. If we close this business, we're sending a message," he said.
Admitting both sides had very good arguments, Cr James Cochrane agreed.
"It will actually lose jobs from our region," he said.
Mayor Mick Curran also voted against the motion.
He said the company was of great benefit to Widgee, and it was unfortunate that the problem had come to the point it had.
"We are very reactive and not proactive... perhaps we need to lift our game," Cr Curran said.
Voting for a refusal, Cr Daryl Dodt said the motion was to move the business, not shut it and Cr Mal Gear said the company was being given "plenty of time" to move.
The refusal was passed five-to-three, with Cr Glen Hartwig leaving the room due to a perceived conflict of interest.
Along with their local work, Widgee Engineering has also worked on projects at Maroochydore, Gladstone, the Gold Coast and Hervey Bay.