The government says Australia's ports, electricity grids and water infrastructure are more vulnerable than ever to sabotage.
It has unveiled a new security agency to monitor Australia's vital assets.
The Government says it will launch a dedicated Critical Infrastructure Centre.
According to the Attorney-General, George Brandis, it's mission will be to give national security assessments and advice to the government on critical infrastructure.
Mr Brandis says a trend towards privatisation and global supply chain arrangements mean key assets such as ports, electricity networks and water resources could be exposed to "sabotage, espionage and coercion".
Essentially, the Centre will advise the government on potentially vulnerable buildings, facilities and technologies - especially if they can be bought or sold on the market.
Paul Barnes, from the Australian Strategic Policy Institute, says the centre will be a central body advising all levels of government.