Foreign Minister Kevin Rudd said the government was deploying every resource to track down what assets Gaddafi's regime may have in the country.
"I'm not advised as to whether there are such assets or not, but such an examination is now under way," Mr Rudd told ABC Radio.
"The critical thing is to cause the regime to know that, whether it's in Australia or any other part of the world, their assets are now being frozen, and this hopefully brings a further item of focus to the mind of this entirely despicable regime."
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
Prime Minister Julia Gillard welcomed the United Nations Security Council's decision to refer the ongoing violence in Libya to the International Criminal Court.
"This is a big step and should be a real warning to Colonel Gaddafi that the world is prepared to hold him to account," Ms Gillard told ABC Radio.
Ms Gillard said the government had still been unable to contact an Australian man taken by Libyan authorities last week.
Mr Rudd also welcomed the UN's decision to impose sanctions and an arms embargo but said it should also consider a no-fly zone to prevent further air force attacks on civilians.
"In my own correspondence with the president of the security council I have said that Australia fully supports the imposition of no-fly zones within Libya itself," he said.
"As for other actions by the council, my own view ... is that all other options should remain on the table as well."
The government believes Gaddafi's "time is up", Mr Rudd said.
"He must go, and the sooner he goes the better for us all."
Australian officials were evacuated from Libya at the weekend because of the deteriorating security situation.
The Department of Foreign Affairs and Trade said the small number of Australians still in the country could get on evacuation flights being run by Ireland, Turkey, Italy and the Netherlands in the coming days.
