The issue of dependency on foreign seafarers in Malaysia has been highlighted in the Malaysia Shipping Master Plan 2017–2022, whereby the number of foreign seafarers on Malaysian ships has been constantly high up to 17,000. A total of 6,000 Certificates of Recognition are issued by the Marine Department annually, which bring a great loss to both economy and career opportunities locally. A policy to reduce dependency on foreign seafarers has been implemented in 2018 as a goal to revitalize shipping for a stronger Malaysian economy. Conflicting priorities between shipping industries and local seafarers while trying to find the best solution to ensure that development efforts are not jeopardized have been a major challenge to the government of Malaysia. This article examines various issues and challenges in managing Malaysia’s dependency on foreign seafarers by using a qualitative research approach. Key stakeholders have been identified through purposive sampling, and face-to-face in-depth interviews have been conducted to identify and understand the issues and challenges faced. The findings show that there are pressing needs to improve maritime governance in Malaysia, especially on system, education, and policy implementation. Fragmented governance arrangements and vague policies are affecting the formulation of effective solutions. It is also argued that an effective and clear management is crucial to reduce dependency on foreign seafarers, as only then can Malaysia’s shipping development efforts be enhanced.