Likened by critics to an island marooned in the Middle Ages, Malta may take a step into the 21st century on Saturday when voters take part in a historic referendum on whether to allow divorce.

If the Catholic church has its way, Malta will vote no, leaving it the only country in Europe and one of only two countries in the world to ban a couple's right to dissolve their marriage.

"Marriage was created by God, Jesus ruled out divorce and we are therefore telling the faithful to vote no," said the archbishop of Malta, Paolo Cremona, who can rely on over half of the island's 400,000 inhabitants showing up at mass.

"Little old ladies are being refused communion if they admit to wanting divorce," said Jeffrey Pullicino Orlando, the MP who has co-authored the draft divorce law. "We are on a different planet out here, the victims of spiritual terrorism," he said. "People's jobs have been threatened and they are reluctant to speak out."

"I am living on an island where people go to church and oppose divorce but have affairs," said a female civil servant. "Men in Malta are often happier having a mistress than a wife."

For weeks Malta has been plastered with posters showing a picture of a child alongside the slogan: "I trust you with my future – Vote No."

But, says office manager Mario Fava, 37, who has been legally separated for seven years with no chance of remarrying, a generation of Maltese children are feeling the fallout from the ban.

"Lots of people want to start new relationships and have children, but are forced to do it out of wedlock, and you see their kids being teased at school," he said.

Orlando said that about 30% of Maltese children are now born out of wedlock thanks to the breakdown rate in marriages.

"I have been called an anarchist for starting this referendum, even though the draft law is about the world's most restrictive divorce legislation, with four years of separation required before divorce," said Orlando. If the vote passes, the bill will go before parliament.

"The hypocrisy of the no voters is incredible," added Orlando. "Many are separated men cohabiting with a new partner who like not being remarried so they can dump the woman at the drop of a hat."

Malta was occupied by Arab invaders in the 10th century before mounting a fierce fightback against an Ottoman siege in 1565. A century and a half of British rule, which ended in 1964, put an Anglo-Saxon stamp on the culture but left Malta a strongly Catholic country.

Orlando said the church's reasons to halt divorce are also rather worldly. "This is about protecting the church courts that offer annulment as an alternative to divorce," he said.

Catholic church courts can rule that a religious marriage was never valid, due to a reluctance or inability by one partner to have children or for other reasons.

"About 8% of marriages here are annulled, allowing the ecclesiastical tribunals to take precedence over the state," said Orlando. "It's about church power."

Chris Gherxi, a separated restaurant owner who said he would like to "start again, but legally," also had his doubts about the church's priorities.

"What is the difference between an annulment and a divorce? With divorce introduced the church would lose a lot of money in legal fees."