The ban will take effect this Saturday and Sunday in Little India, which saw the city-state's worst civil unrest in decades on Sunday.
Hundreds of migrant workers from India and Bangladesh clashed with police and set fire to vehicles after an Indian labourer was hit by a bus and died.
But critics say the ban amounts to an "alcohol apartheid" and have expressed concern that the government may extend it in the future.
Government ministers "are conveniently suggesting that alcohol consumption is to blame for the riot rather than looking to their own failed immigration and labour policies," said Kenneth Jeyaretnam, leader of the opposition Reform Party.
"Statements such as these also carry the subliminal message that ‘Indians’ are somehow more likely to abuse alcohol and become violent than other groups."
He added that expats of many nationalities have been involved in violent incidents, often fuelled by alcohol.
Human rights activists also expressed concern at the blanket ban on alcohol sales, in an area that on Sundays is packed with migrant workers from South India enjoying their weekly day off.
"One wonders whether this is a temporary measure or whether it will become a permanent regulatory restriction that targets a particular area that is overwhelmingly occupied by one ethnic group," Phil Robertson, Human Rights Watch deputy director for Asia, told dpa.