Both squirrels were euthanised due to biosecurity concerns.

The man had his bags searched after a member of the public tipped off border security on December 4.

Department of Agriculture Biosecurity Operations chief Nico Padovan said the passenger's alleged actions had put the nation’s health at risk.

“The fact that this passenger would intentionally breach our biosecurity conditions and put our country at risk is unbelievable,” Mr Padovan said.

“Squirrels can carry rabies - which is present in Bali - and if this disease was to arrive here the toll on human and animal health would be huge.

"Every year more than 60,000 people worldwide die from rabies.

“Biosecurity is no joke and the passenger is now subject to an investigation and could face a range of serious penalties, including criminal prosecution."

Australian Border Force's Queensland commander Terry Price said smuggling of wildlife is not only illegal but also very cruel and inhumane.

“Given Australia’s famed, unique and fragile biodiversity, it is crucial that we do all we can at the border to stop animals from entering Australia that may constitute a disease or other threat,” he said.

The maximum penalty for wildlife trade offences under Australian law is 10 years’ imprisonment and a fine of up to $210,000 for individuals or up to $1,050,000 for corporations.