eBay is to close its operations in Dundalk in the second quarter of next year.
In an email sent to staff today, Senior Vice-President of Global Customer Experience Steve Boehm says the company is proposing to expand in the operating locations where it already owns or leases space.
When PayPal separated from eBay last year, PayPal became the landlords of the current facility in Dundalk and have now informed eBay that it intends to expand its own facilities on the site.
eBay currently employs 150 people at its Dundalk base.
Local Fianna Fáil TD Declan Breathnach says it is a huge body blow for the town.
He said: "I have continually said, despite the fact the Louise Phelan of PayPal assured my office today they intend to expand at PayPal and would accommodate a lot of the staff, we've always held the view that a bird in the hand is worth two in the bush.
"It is now incumbent on the IDA to ensure that eBay stay in the region."