"Australia is committed to a two-state solution in which Israel and a future Palestinian state coexist, in peace and security, within internationally recognised borders," Foreign Minister Penny Wong said during a media briefing.
"We will not support an approach that undermines this prospect."
In 2018, the conservative coalition government led by Scott Morrison formally recognised west Jerusalem as Israel's capital, reversing decades of Middle East policy. Morrison had flagged moving the embassy from Tel Aviv in 2018 just days before a by-election in a Sydney electorate with a strong Jewish representation, which his Liberal party nonetheless lost. It drew criticism from Muslim-majority neighbours such as Indonesia and Malaysia.
Morrison's Liberal-led coalition lost a national election in May.
The status of Jerusalem, home to sites holy to the Muslim, Jewish and Christian faiths, is one of the biggest obstacles to a peace agreement between Israel and Palestinians. Israel regards all of the city as its capital, including the eastern sector which it annexed after the 1967 Middle East war, and wants all embassies based there.
Reuters