A court decision ruling that the detention of asylum seekers is illegal was inevitable, says the MP for Papua New Guinea's Manus Island Ronny Knight.
The PNG government is seeking legal advice over yesterday's Supreme Court decision, that the detention of 850 male asylum seekers was unconstitutional.
It ordered Australia and PNG to take steps to end it.
Foreign Minister Rimbink Pato said the government would only make a statement after studying the implications of the decision.
Ronnie Knight, the opposition MP from Manus Island, said the decision could not be appealed and the Australian government would have to relocate all the detainees - including those deemed to be refugees.
He said the issue was now in Australia's hands and it will have to relocate them to Christmas Island or Nauru.
"It's the end of the game. With the asylum seekers in Manus right now, definitely they have to go. They were never intended to stay in Manus. Let's put it this way, we were willing to assist Australia with the problem, not to adopt the problem."
Ronnie Knight said none of the more than 800 people have been settled on Manus, although some men might have access to land as they were in relationships with local women.
The centre reopened in 2012 after Australia sought PNG's assistance to process its asylum seekers abroad.
Mr Knight said his constituents had benefited from jobs at the centre.
"Our people have been through this once before in 2001 though at that time Manus people and businesses never got anything out of it. When it closed down it closed down pretty much overnight. This time a lot of people will be losing jobs, a lot of people will be out of work and back to the village and back to their normal routine at home."
Ronny Knight had previously warned of the threat of unrest at the centre if problems there were not addressed.
"Jubilation" in Manus
The lawyer representing 300 asylum seekers on Manus Island said there was jubilation in the detention centre after the landmark court ruling.
Ben Lomai has been challenging the constitutionality of detention in a separate case to the one decided yesterday, which was brought by Belden Namah when he was leader of the opposition.
Mr Lomai said he will make an application to the Supreme Court on Monday to have his clients sent back to Australia.
"There's a lot of jubilation in the camp but at the same time there's mixed feelings because they're more interested to know where they are going to go from there. Now that they have their freedom what's next? Where are they going to go?"
Mr Lomai said the men think they might be sent to Nauru.