Why did the United States institute an immigration quota during the 1920's?

The United States instituted a quota on immigration in the 1920s because many Americans felt that there were too many immigrants in the United States and (very importantly) that the immigrants were from the wrong countries.

Between 1880 and WWI, a large wave of immigrants came to the United States.  These immigrants (we sometimes call them “new immigrants” today) were different from the last major wave.  The previous wave of immigrants had generally been from Western and Northern Europe.  The new immigrants, by contrast, were generally from Southern and Eastern Europe.  In addition, many of these immigrants were either Catholic or Jewish. Many Americans in those days looked down on and distrusted people of those two faiths.  Finally, many of the immigrants were political radicals. Because of these differences (and because of the large number of immigrants present in the US), the US set immigration quotas that were based on the populations from various countries in the 1890 census, before the new wave of immigration had brought the largest numbers of immigrants to the  US.