Living on the streets will be illegal in parts of Hungary after the government passed a bill making rough sleeping punishable by fines and imprisonment.
Hundreds protested outside parliament ahead of the vote with signs reading "You can also become homeless!" and "Poverty is not a crime."
The law, passed late Monday, bans living on the streets in the capital's world heritage sites, which are popular with tourists, and allows local governments to impose their own bans in designated areas.
Human rights campaigners argued the move was tantamount to criminalising homelessness.
If such a ban is applied, police can ask homeless people to leave. If they fail to do so, they have to do community work or pay a fine. Repeat offenders could face jail time.
Betti Fetter, 50, who has been homeless for about 20 years, said: "It is about chasing the homeless people. How can such a country exist where you are punished because you don't have a place to live?"
Ms Fetter lives in a hut made of foil and wood with her daughter in Budapest and fears police will soon try to force her to leave.
The government stated that £1m has been allocated this year for homeless services specifically for the winter, on top of £25m in funding.
A statement from the government on Monday insisted: "the provision has been adopted primarily in the interest of the homeless people, in the aim to avoid that while there are enough shelters to stay at for all of them, they rather choose to stay at public areas where they risk freezing to death in winter."
The United Nations last year stated there are 5,500 available spaces in Budapest's shelters while there are about 8,000 homeless people in the city and an estimated total of 30,000 to 35,000 in the country.
Winter puts the greatest stress on services buts social worker Zoltan Guraly who works for a shelter in Budapest said there is already overcrowding.
"We [told] ten people... 'no more space, please go away' and that was yesterday."
Mr Guraly said that if the homeless are forced to change their living spaces everyday it will put greater pressure on people who are already in poor mental and physical condition.
Ms Fetterne stated shelters are often so bad, many choose to live on the streets instead.
"Living conditions in the homeless shelters are just unbearable," she said. "People [are] literally everywhere: under the beds, on the tables and ... there are cockroaches and bed bugs."
An activist with the Hungarian NGO, The City is for All, Tessza Udvarhelyi, argued the government wants to appeal to conservative voters and make the homeless invisible, especially to tourists.
"They think the only problem about homelessness is that it's visible, not that it exists."
In November 2012, Hungary's constitutional court struck down a nationwide ban on living on the streets because it violated the constitutional right to human dignity.
Offenders could have been fined or jailed. The Hungarian Civil Liberties Union said it obtained government documents showing that about £83,000 of fines were incurred when the law was in effect.
In March, the government amended the constitution to allow local governments to ban living in public places "in order to protect public order, public security, public health and cultural values."
A report from the legal body of the human rights watchdog the Council of Europe stated the reform was a reaction to the November court decision and added that the government was using the constitution to shield laws from judges.
David Reingold, a visiting professor of public policy at Budapest's Central European University, said cities in the United States have similar laws but it is unusual for a national government to impose such measures.
Mr Reingold added the law may be a gesture to likeminded voters that the government shares their values as the country heads into an election next year.
"They want conflict, they want the EU to condemn them," Mr Reingold said.
"Their political support comes from people who... actually feel good when the EU [rises] up and says that they object."