From July 2012, eligible fathers will receive two weeks' leave paid at the federal minimum wage, currently $570 a week.
Ms Gillard says the payment would provide financial support to fathers and other secondary carers who meet work and income tests.
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The additional fortnight will be added to Labor's already legislated scheme which provides 18 weeks paid leave from January next year.
Labor expects 220 thousand secondary carers to benefit.
Ms Gillard rejected suggestions the announcement was a last-minute campaign attempt to make her appear more family friendly.
"Guess what, I'm not going to give you an insight into how we do our campaign policy announcements," she told reporters at the National Press Club in Canberra.
The Australian Greens say the extra leave is still not enough.
The party wants a six month scheme, including superannuation, paid at the minimum wage.
"The announcement provides some welcome time for dads and other carers ... but it still fails to address the real support families need," Greens senator Sarah Hanson-Young told AAP.
