Malcolm Turnbull wants Australians to know authorities are working day and night to protect them from attacks like the one in Germany.
But the prime minister concedes the risk can't be mitigated entirely.
At least 12 people were killed and dozens more injured when a truck ploughed into a Berlin Christmas market.
Mr Turnbull said the government utterly condemned the attack, the latest in a string of terror-related incidents across the globe.
"We are very attentive to events internationally to ensure that we learn from them and make sure that we put measures in place to anticipate similar occurrences here," he told reporters in Adelaide on Tuesday.
He said Australia's police and security forces were the finest in the world and keenly focused on keeping Australians safe.
"Whether they are at a market or a New Year's Eve celebration - nonetheless, we cannot mitigate all risk entirely."
The Berlin attack is similar to the July incident in Nice, France, where 86 people were killed after a truck drove into crowds celebrating Bastille Day.
Following that attack, Mr Turnbull asked his counter-terrorism co-ordinator to review all measures to protect people at mass gatherings and events.
"Everyone is well prepared to accept to anticipate attacks of this kind," he said.
Acting opposition leader Penny Wong labelled the Berlin event tragic and despicable, and said Australia stood in solidarity with the people of Germany.
"We do live in times where we see greater risks and what I would say to all Australians is we will, together in the parliament, keep working to keep Australians safe and we have great confidence in Australia's security agencies," she told reporters in Australia.
The Australian Trucking Association have released a statement saying it has 'urged trucking operators to review security for their vehicles and staff following what appears to be a terrorist attack in Berlin this morning'.
'If you are in the industry and see something that doesn’t add up, contact the National Security Hotline on 1800 123 400.'
The prime minister also condemned the "cowardly assassination" of the Russian ambassador to Turkey, Andrei Karlov.
He has been in touch with Australia's ambassadors in both countries and spoken to heads of security and the Australian Federal Police.
Mr Turnbull extended condolences to the families of those killed, and said the government had reached out to Russian, Turkish and German diplomatic staff in Australia.
Australia's terrorism alert level remains at 'probable'.
Foreign Minister Julie Bishop confirmed that no Australians were among those killed or injured.
She said officials from her department were providing consular support to a young Australian woman who witnessed the incident at close quarters.
The federal government updated its travel advice to Germany three days ago, warning people about the vulnerability of Christmas markets and urging people to have exit plans.
"Somewhat prescient some might say," Ms Bishop told Sky News.