It follows uproar over comments in parliament from the immigration minister that most of Australia's foreign fighters had Lebanese Muslim heritage.
Minister Peter Dutton also said it had been a mistake, for that reason, to welcome Lebanese Muslims to the country in the 1970s under Malcolm Fraser's leadership.
The Prime Minister, MalcoIm Turnbull says when it comes to Australia's national security, there is no bliss in ignorance, and no comfort in complacency.
That was the tone of his National Security update in the lower house, urging caution about the threat of terrorism at home and abroad, while praising Australia's freedom, diversity and security.
"We are one of the most successful multicultural societies in the world. From the oldest human cultures of our first Australians to the newborn baby in the arms of its immigrant mother, we're stronger because of our diversity, but that does not mean that we should be blind to or ignorant of the challenges our society faces."
Mr Turnbull's address follows a day of backlash against Immigration Minister, Peter Dutton, after his comments linking Lebanese Muslim immigration in the 1970s to terrorism today.
The Prime Minister still has not condemned Mr Dutton's remarks.
"When we see extremist behaviour it should be called out for what it is, and when we see vulnerability it should be addressed by all Australians: by government, by business, by community."
Opposition Leader Bill Shorten took issue with the Prime Minister in his response to the address.
"In this place we have a solemn responsibility to counter that argument of the extremists - of the the extreme right and the extremists within the Middle East - who say that being a Muslim citizen of this democracy is incompatible with their faith. What we need to do is counter that argument, not amplify it." (Hear, hear!)
In a direct comment about Mr Dutton, Mr Shorten said he was concerned about the effect the Immigration Minister's statement in parliament might have on people with extreme views.
"I am fearful that Minister of Immigration's comments will be used by an extreme few who would seek to harm the fabric of our society. Second and third generation migrants are teachers, they are police officers, they are entrepreneurs, they are members of this parliament on both sides of the house. Don't start by calling them second and third generation migrants - we call them Australians."
Leading Muslim community groups, including the Lebanese Muslim Association and the Australian National Imams Council, have condemned Mr Dutton's comments.
Politicians too, have been speaking out.
Labor MP Anne Aly called on Mr Turnbull to reject Mr Dutton's comments which, she says, are offensive to all migrant Australians.
"It wasn't that long ago that Malcolm Turnbull said that 'the best weapon against terrorists is an inclusive nation'. And you know, if Malcolm Turnbull believes that - if he really believes that - he would have come out and slapped down Peter Dutton's disgraceful comments against migrant Australians who have helped build this nation."
She says Mr Dutton's remarks resonate with a section of the community who may now feel emboldened to express intolerant views.
"Well, I got some rather nasty emails just yesterday. One saying that 'Peter Dutton is correct and that I need to [go] home and take all my terrorist friends with me'. I'm pretty much used to them and I've got a pretty thick skin; I can handle it. But there are a lot of people out there who I think will be much more affected by them."
President of community group, Australian Muslim Voice, and Chair of the Canberra Multicultural Community Forum, Diana Abdel-Rahman, says she's concerned about that too.
She says many in the community are disappointed that Malcolm Turnbull is not condemning the Immigration Minister's remarks.
"I think he's shown his weakness. And he's obviously being guided by those in his own party who have very extreme views. He seems to be not powerful enough, strong enough, or has the will to stand up and speak what he probably should be saying as the leader of Australians, all Australians."
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