Ibrahim Ali, the head of Perkasa, a group that champions rights of the ethnic Malay Muslim majority and has close links to the ruling coalition, was reported in media as advocating Muslims should seize and burn copies of Bibles which use the word "Allah" to refer to God.
"This incident together with the contemptuous statement by another Perkasa leader against a judge and the judiciary suggest that Perkasa is allowed to behave with impunity," he said.
The latter refers to a Jan. 7 article written by a senior Perkasa member attacking a high court judge presiding over a defamation case brought by opposition leader Anwar Ibrahim.
Neither Ibrahim Ali nor the home ministry were available for comment.
The events foreshadow an intense election struggle as the country prepares for an election which must be called by April.
Opinion polls show that the ruling Barisa National coalition of Prime Minister Najib Razak, in power since independence from Britain in 1957, has all but lost the support of ethnic Chinese, who account for about 25 percent of the population.
The coalition will have to rely on more votes from Malays, who make up around 60 percent of Malaysians. Christians account for about 9 percent and a substantial number are Chinese.
The ruling coalition suffered its worst election result in 2008, losing its two-thirds majority in parliament for the first time. The next election is predicted to be even closer, although the coalition is still widely expected to win.
Malaysia has not experienced a major race riot since May 1969, when violence erupted after largely ethnic Chinese based parties made unexpected gains in general elections.
The chief minister of opposition-ruled Penang state on Wednesday put police on alert after a note was found at a church promising a Bible-burning "festival" on Sunday.
The note, shown on the opposition-friendly online news portal Malaysiakini, signs off with "Let's teach 'em a lesson".
Penang Chief Minister Lim Guan Eng urged the home minister to "impose stringent measures to prevent such abhorrent and vile acts that would endanger national harmony and heighten religious tensions".
He also called for stern action against Perkasa's Ibrahim.
The tussle over the word "Allah" goes back to 2009 when the Catholic paper Herald successfully challenged in court a government ban preventing non-Muslims from using the word to refer to God.
The government wants to prevent "Allah" being used by Christians, saying it is subversive and aims to convert Muslims.
The sultan of Selangor state this month issued an decree banning the word from being used by non-Muslims.