The DOJ sent out letters Wednesday notifying the state it is in violation of the Civil Rights Act.
Read the entire letter here
Early Thursday evening, Gov. Pat McCrory's office confirmed the governor and state leaders will have a response by Monday.
RELATED: US GOVERNMENT SAYS NORTH CAROLINA LGBT LAW VIOLATES CIVIL RIGHTS
"The Obama Administration Justice Department is trying to hold North Carolina hostage, trying to hold students hostage, and it's really shameful. It's a shameful approach," Lt. Gov. Dan Forest said. "The decision of protecting women and children in bathrooms and locker rooms and changing facilities, there is no price tag you can put on that."
In part, HB2 essentially bans transgender people from using public bathrooms and changing facilities for the gender with which they identify. The law says people must use the public restrooms that correspond with the gender listed on their birth certificates.
"The DOJ coming out this strongly reaffirms that this is a discriminatory law the legislature should not have passed," said ACLU Acting Executive Director Sarah Preston.
McCrory and top Republican leaders have until Monday to essentially get rid of the law.
NOTABLE FIGURES REACT TO DOJ'S WARNING LETTER ON HB2
NC House Speaker Rep. Tim Moore said there isn't enough time to repeal the law, which was passed in a one-day special session.
"We're not even in session right now. We've adjourned for the weekend. So that just simply won't happen," Moore said.
"They're being misleading when they say that. They can obviously pass legislation very quickly when they want to," Preston said.
Read all ABC11 stories about HB2 here
The Attorney General's Office is not representing the state in the case.
Attorney General Roy Cooper has criticized HB2 and calls it a "national embarrassment." Cooper is refusing to uphold the law in court.
Report a Typo