Success in suppressing coronavirus cases in East Lothian will see the local authority move down to level two from Tuesday at 6am.
But an increase in positive cases in next door Midlothian means no reprieve for the council area which is to stay in level three.
Garry Clark, from Federation of Small Businesses, said traders in the region are “angry, disappointed and confused” after expecting the local authority to see an easing of restrictions as with its neighbouring council area.
“Many businesses have spent quite a bit of money and prepped themselves for the Covid rules to ease in Midlothian from tomorrow,” Mr Clark said.
"They are incredibly angry, confused and disappointed after today’s confirmation that the council area won’t be going down a level.
"The hard part is it’s just such short notice for them when the general consensus was that restrictions were going to ease like we’ve seen for East Lothian.”
Mr Clark said the hospitality sector in the area has suffered most, with some businesses hiring more staff, preparing for sales of alcohol and more flexible closing times.
"It really is a big disappointment overall, and what’s worse is the announcement made by the government has no acknowledgement of businesses in it whatsoever,” Mr Clark added.
"We understand the health aspects of this virus, but businesses are really fighting hard to survive and doing all they can. So to be hopeful for restrictions to ease and then for that to be shot down this evening was really frustrating.”
The Sun Inn, in Dalkeith, had to cancel 210 bookings it had planned for Saturday night in the hope restrictions would be lifted.
A message on the pub’s Facebook page read: “Sorry folks. We remain in Tier Three until further notice.
"All bookings for 4.30pm onwards are cancelled, unfortunately we do not have the facilities to contact every booking. We had 210 booked in for this Saturday alone. Sorry.
“To our suppliers - we apologise but we will have to return stock, please understand our predicament.
“To our customers - we are still here, still open 8am until 6pm last booking 4pm. As ever we will release new menus and takeaway to combat the situation we find ourselves in - please continue to support us and your local restaurants.
“To our staff - we will not alter our rota - you will not lose your shifts - we WILL FIGHT ON - we will redecorate some bedrooms and find you work - there may be tweaks so keep an eye on your group chats and scheduling app.”
Customers have reacted to the news saying they are “gutted” and have slammed Nicola Sturgeon for “killing businesses.”
Last week, the first minister indicated that both East Lothian and Midlothian could see an easing in protection levels “assuming no significant deterioration before then.”
Yet with Midlothian’s rise in cases, the local authority cannot follow its neighbour.
Nicola Sturgeon said: “I know this will be disappointing for people in Midlothian, however, it is better than moving down a level only to possibly have to move back up again in a week’s time.
“We were clear that moving Midlothian to Level 2 was dependent on current positive trends in this area continuing. But unfortunately, over the last week we have seen an increase in case numbers and test positivity rates in Midlothian.
“We will continue to monitor the position in Midlothian and work together with the Council on its plans for ensuring that a move down is sustainable when the time is right.”