[UPDATE - Thurs, Jun 8]: The teacher responsible for the "awards ceremony" at Anthony Aguirre Junior High in Channelview, Texas, is no longer employed by the school, reported The New York Times.
The Channelview Independent School District said in a statement: "We have concluded our investigation, and the teacher responsible is no longer employed by the district."
It is unclear if the teacher was fired or resigned from the post.
While the teacher was not named, the certificates awarded to the students were signed by Stacy Lockett.
13-year-old Lizeth Villanueva was in for a rude shock when she attended her school's mock end-of-the-year awards ceremony on May 23.
Instead of "best behaved" or "most responsible", the young girl received a "most likely to become a terrorist" certificate, a tasteless joke considering the Manchester Arena Bombings had occurred only one day earlier.
The "award ceremony" was held at Anthony Aguirre Junior High in Channelview, Texas, where Villanueva had been enrolled in the academic honours programme for the past two years.
As an honours student with good grades and no disciplinary record, Villanueva was understandably shellshocked when handed the award.
"A terrorist is a really big thing," said the Salvadoran American. "Just what happened two, three days ago with Ariana Grande and her concert, and they're joking around with this? That's not something to joke around with."
She has been 'too uncomfortable' to return to school since, the Washington Post reported.
According to Villanueva, teachers had warned students prior to the ceremony that although the awards were supposed to be funny, they "might hurt feelings".
Speaking to a local TV station, she said that "[The teacher] said she was scared to give out this award because she doesn't know what might happen… The teachers [laughed], too . There were four."
Other offensive awards given out include "most likely to cry for every little thing" presented to another girl, and "most likely to become homeless" which was presented to a boy.
Another child who has chosen to speak out is Villanueva's 13-year-old African American schoolmate, Sydney Caesar, who was presented with a cringe-inducing "most likely to blend in with white people" certificate.
Mothers of both girls were not amused by the awards their daughters had received.
"I was upset and very mad when I saw the award," said Ena Hernandez, Villanueva's mother, when interviewed by the Washington Post.
"I was surprised because my daughter has been doing well in the honours programme."
Caesar's mother, Latonya Robinson, condemned the awards, saying: "For that child to either be called a terrorist or she's not black enough, basically now the students are taking that and that's her label for the rest of the school year."
The school has since apologised for the incident and said that those involved are being disciplined in accordance with policy.
The children's families have been informed that the teacher who gave out the awards has been suspended until the end of the year.