Trump is said to be in violation of the Constitution because his business properties abroad operate partly based on goodwill.
In a statement released Sunday the Citizens for Responsibility and Ethics in Washington (CREW) said the newly sworn-in Trump was in violation of the Constitution because his business properties abroad operate partly based on goodwill from foreign governments and regulators.
The US Constitution states that no federal official can receive a gift or "emolument" from a foreign government.
"We did not want to get to this point, CREW executive director Noah Bookbinder said in the statement. "It was our hope that President Trump would take the necessary steps to avoid violating the Constitution before he took office."
"We were forced to take legal action."
The group cited payments from guests at his hotels and golf courses and space leased in his properties by foreign governments as examples of "getting cash and favors."
The CREW non-profit will not seek monetary damages but intends to file the suit in a Manhattan federal court when it opens Monday morning.
"President Trump has made his slogan 'America First'," Bookbinder said.
"So you would think he would want to strictly follow the Constitution's foreign emoluments clause, since it was written to ensure our government officials are thinking of Americans first, and not foreign governments."
Trump's two eldest sons are officially staying in New York and running the Trump Organization in their father's absence.
The new president stopped short of making a full divestment prior to taking office, earning a swift rebuke from an ethics watchdog and Democratic Party opponents.