A letter signed by more than 100 Microsoft employees has called on it to stop working with the US Border Patrol.
The call comes as the Trump administration faces intense criticism over the separation of children from their families at the Mexican border.
The letter, posted on an internal message board and published by the New York Times, said the employees "refuse to be complicit”.
Microsoft has shared a response penned by its chief executive Satya Nadella.
"I am appalled at the abhorrent policy of separating immigrant children from their families," he wrote.
"This new policy implemented on the border is simply cruel and abusive, and we are standing for change.
"I want to be clear: Microsoft is not working with the US government on any projects related to separating children from their families at the border."
However, the company does have a $19.4m (£14.7m) contract with the US Immigration, Customs and Enforcement agency, known as ICE.
Mr Nadella said this was to support tasks involving email, calendar, messaging and document management.
In January, Microsoft posted information about how its cloud computing platform, Azure, was being used to facilitate data “security and compliance”.
The post read: “We're proud to support this work with our mission-critical cloud.”
The signees of the letter to Microsoft chief executive Satya Nadella demand the company ends this association with ICE, and "other clients who directly enable ICE”.
Their efforts chime with the thoughts being expressed by employees at many of Silicon Valley’s top firms. On Tuesday, some of the region’s top chief executives made statements on the issue.
Skip Twitter post by @sundarpichai
The stories and images of families being separated at the border are gut-wrenching. Urging our government to work together to find a better, more humane way that is reflective of our values as a nation. #keepfamiliestogether
9:16 PM - Jun 19, 2018
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“The stories and images of families being separated at the border are gut-wrenching,” wrote Sundar Pichai, Google’s chief executive, on Twitter.
"Urging our government to work together to find a better, more humane way that is reflective of our values as a nation.”
Apple boss Tim Cook, speaking after an event in Ireland, told the Irish Times the situation was “inhumane”.
"It’s heartbreaking to see the images and hear the sounds of the kids. Kids are the most vulnerable people in any society. I think that what’s happening is inhumane, it needs to stop.”
Facebook's Mark Zuckerberg said: "We need to stop this policy right now."
Other condemnations have come from the bosses at AirBnB, Twilio and Box.
A fundraiser on Facebook had raised more than $6m on Tuesday, growing at a rate of thousands of dollars every minute. It is the largest amount ever raised on the platform.
Employee rebellion recently saw Google drop its contract with the US Department of Defense. It had been aiding the development of software designed to increase the accuracy of drone strikes.
A number of Google employees resigned and thousands more signed a petition against the project, known as Maven, fearing it would be the first step in artificial intelligence being used to kill people.