The High Court has ruled Australia's policy of detaining asylum seekers on Papua New Guinea's Manus Island, and Nauru, is lawful.
A challenge brought on behalf of a Bangladeshi asylum seeker was rejected by a 6-1 majority of the court's full bench.
The verdict means hundreds of asylum seekers currently in Australia -- among them children -- could be returned to overseas detention.
Australia's highest court has ruled against a challenge to Australia's offshore immigration detention brought by the Melbourne-based legal group, the Human Rights Law Centre.
The case represented a pregnant Bangladeshi woman who was transferred from Nauru to Australia for medical treatment in 2014.
The woman, who has a one-year-old daughter, says she is terrified of being sent back.
But with only one judge dissenting, the High Court found Australia's decision to detain her on Nauru was lawful under the Migration Act, and the Australian Constitution.
Daniel Webb from the Human Rights Law Centre was disappointed by the outcome.
"The legality is one thing; the morality is another. It is fundamentally wrong to condemn these people to a life in limbo on a tiny island."
The implications of the ruling are believed to affect over 250 other asylum seekers currently in Australia -- many for medical treatment.
Among them are said to be more than 90 children.
Some, it's been alleged, have suffered mistreatment, including sexual abuse, on Nauru.
Professor Elizabeth Elliott is an expert in child health at the University of Sydney, who has worked with child asylum seekers detained on Christmas Island.
Professor Elliot says extended detention is taking an immense toll on children.
"The children we encountered were really quite desperate. Some of them had lost developmental skills. For example, they had become withdrawn, they had developed behavioural problems, sleeping difficulties, bed-wetting. Some had even lost their speech."
Ahead of the ruling, Immigration Minister Peter Dutton insisted the government was acting in the best interests of asylum seekers brought to Australia for health care.
But, he said, the government has to be mindful of the message being sent to people smugglers.
In parliament, Prime Minister Malcolm Turnbull positioned the High Court verdict in the context of his government's border protection policy.
"We'll consider the judgment and its implications carefully. But what I can say is this: our system of deterrence remains robust."
Speaking on the ABC, Deputy opposition leader Tanya Plibersek said the government has questions to answer over its management of offshore detention facilities.
"There's no excuse for the fact that processing times have doubled under this government, that they're at an average of about 455 days now. The detention centres on Nauru and Manus are being run in a way that the government should answer for."
Greens leader Richard Di Natale says issue goes right to the heart of Malcolm Turnbull's prime-ministership.
"The question now is for the Prime Minister who promised that with his election we would see a new page in the Australian story -- one that's more positive and optimistic. Well, this is something that is occuring right now, under his watch, with the support of Bill Shorten, the opposition leader. The incarceration of young kids, young women, returned to people who have inflicted that trauma upon them."
The Human Rights Law Centre's Daniel Webb says, despite the High Court's ruling, the government can choose to allow the asylum seekers brought out of detention overseas to remain in Australia.
Mr Webb says he's appealing to Mr Turnbull and the Immigration Minister Peter Dutton to make just such a decision.
"The stroke of a pen is all that it would take our Prime Minister or our Immigration Minister to do the decent thing and let these families stay."
The federal government, with Labor's support, had retrospectively changed laws to bolster the Commonwealth's ability to pay for the offshore facilities last year.
Its case in part hinged on a sudden decision last October by the Nauru government to allow asylum seekers to move around the Pacific island.
