The Subang Jaya Municipal Council, which administers the suburb where the concert was held in late July, fined organizers Absolute Entertainment 10,000 ringgit US$2,714 for flouting decency regulations, the Malay Mail tabloid reported.
The six-member all-girl group from the United States are known for worldwide hits such as "Don Cha" and "Buttons." They performed to a sold-out arena in Muslim-majority Malaysia as part of their global tour, the AP reports.
The council plans to take the organizer to court if the company fails to settle the fine, the paper said.
A spokesman for Absolute Entertainment, speaking on condition of anonymity, said they were meeting with council officials midday Wednesday. She declined to provide further details.
The government in this Southeast Asian nation had previously warned Western artistes not to be too "raunchy" so as not to offend local sensitivities when performing in Malaysia.