WASHINGTON—The Justice Department escalated its fight with big cities and other jurisdictions over immigration on Friday, suggesting that illegal immigration is increasing urban crime and threatening to pull grant funding from uncooperative jurisdictions.

New York City, which reported record-low crime rates last year, responded angrily, as did the state of California.

The specific issue at hand is fairly small: whether jurisdictions are complying with federal rules that block them from preventing their officials from communicating with federal agencies about immigration. The Justice Department sent letters to nine jurisdictions on Friday threatening to withhold grant funding if they don’t affirm they are in compliance with that law.

The bigger issue is the Trump administration’s effort to crack down on “sanctuary cities,” or jurisdictions that to varying degrees decline to assist federal officials in their efforts to identify and potentially deport people living in the U.S. illegally.

Many liberal jurisdictions maintain that they are under no obligation to assist the Trump administration as it works to ramp up deportations of people in the U.S. illegally.