The Home Ministry has issued The Star a show cause letter over its Saturday front page where a picture of Muslims praying was published under a separate story with the headline "Malaysian Terrorist Leader".

The daily, which yesterday apologised for the "oversight" following public outcry, has seven days to tell the ministry why its publication licence should not be suspended under the Printing Presses and Publications Act 1984.

"The ministry is saddened that the headline was published on the same page as a picture which was totally unrelated.

"It is highly inappropriate for the picture and the headline to be published on the same page, and it has caused confusion, misunderstanding and prejudice against Muslims, which could imply a connection with terrorism...