ACV Hervey Bay intercepted the vessel north of Cocos (Keeling) Islands on Friday afternoon.
The passengers will be taken to Christmas Island for security, health and identity checks.
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Meanwhile, a boat carrying close to 200 asylum seekers has made September a record month for would-be refugees arriving by boat.
HMAS Broome boarded the vessel northwest of Christmas Island on Friday morning after it had sought assistance.
It was carrying 195 passengers and three crew, who will also be taken to Christmas Island for security, health and identity checks.
It is the biggest number of asylum seekers to arrive on a single boat since the government announced on August 13 it would restore offshore processing on Nauru and Papua New Guinea's Manus Island.
It also takes total arrivals by boat in September to 2065 - the highest number of people to arrive in a single month, the opposition's immigration spokesperson Scott Morrison says.
"Under John Howard's full suite of border protection measures ... just 272 people arrived on 16 illegal boats over six years," he said in a statement.
"At this rate it would have taken John Howard almost 50 years to reach the more than 2000 illegal arrivals by boat that have occurred under Labor in less than a month."
Under the federal government's new offshore processing regime, they could be sent to Nauru or Papua New Guinea's Manus Island.
Scott Morrison said boats intercepted outside Australian waters should be sent back to Sri Lanka "to send a clear message that Australia's borders are closed".
"Safe return policies for Vietnamese were a key part of the regional response to the Indochinese refugee crisis in the late 1980s," he said on Saturday.
"There is no reason why similar policies cannot now be put in place in Sri Lanka."
The government expects about 500 asylum seekers will be at the Nauru facility by the end of September.
Nauru has capacity for 1500, and once Manus Island is in operation it will be able to take 600.
But the reopening of the Manus Island facility risks getting bogged down in a dispute between landowners and the PNG government.
The landowners have given the government seven days to meet demands for A$45 million in aid and building contracts or they will take legal action against the refugee processing facility.
The Howard-era Manus facility closed in 2004 and the site has fallen into serious disrepair.
