Foreign Minister Julie Bishop says she wants to independently verify China has placed missiles on a South China Sea island before buying into the row about militarisation of the disputed territory.
Ms Bishop, in Beijing for the annual foreign and strategic dialogue, said she had raised this in her discussions but Chinese officials had not conceded the missile reports were correct.
She said she would discuss this with Australian intelligence and foreign policy experts when she returned home.
"I am not going to buy into this until there has been verification that will satisfy Australia," she told Sky News.
Ms Bishop said China's President Xi Jinping had declared in Washington that China did not intend to militarise the islands it claims in the South China Sea.
So any act that could be seen as militarisation would raise concerns and tensions, she said.
Commercial satellite imagery seems to show a pair of advanced surface-to-air missile systems on Woody Island in the disputed Paracel Islands group.
The US has no doubt, with US Secretary of State John Kerry saying this militarisation was a serious concern.
Labor has called for Australia to press China to participate in international arbitration on the disputed islands by conducting an unannounced freedom of navigation or freedom of overflight exercise.
That would involve an Australian warship or RAAF aircraft approaching one of the disputed islands within the 12-nautical mile limit China is seeking to impose.
Ms Bishop said Australia embraced freedom of navigation and freedom of overflight in accordance with international law but was not going to add to tensions.
She said the South China Sea had certainly come up in her talks, including with Foreign Minister Wang Yi, and they had agreed to disagree.
"We urge all parties to exercise restraint to settle their disputes peacefully and to de-escalate tension, and not act in a way that would escalate tensions and lead to potential miscalculations," she said.
Labor defence spokesman Stephen Conroy said the government talked tough on the South China Sea but now needed to stand up for the international rules by conducting the type of freedom of navigation exercise the US had already conducted twice.
"China understands very much that Australia has a very strong position. But we do have to be prepared to demonstrate support not just words," he said.
Opposition leader Bill Shorten said there was "quite a strong degree of bipartisanship" around national security in Australian politics.
"We do believe that the international rules of the sea should be adhered to, that our ships should have passage through the South China Sea, and we certainly believe that the matter should be resolved peacefully through international tribunals and international mediation," he told reporters in Perth.
