Defence says up to 10 Defence Force members were on board the Australian aircraft at 12.35am on Thursday when a laser from a Luyang-class guided missile destroyer was detected illuminating the aircraft while in flight over the Arafura Sea in Australia's exclusive economic zone (EEZ).

"I can see it no other way than an act of intimidation," the Prime Minister said.

"One that is unprovoked, unwarranted, and Australia will never accept such acts of intimidation."

Labor leader Anthony Albanese backed the Morrison government's condemnation.

"Well, it's an outrageous act of aggression that should be condemned, and I condemn it," he said.

"And I'm sure that the Australian government should be making the strongest possible statement about what is a reckless act."

Mr Morrison suggested people could guess what the reaction would have been if an Australian vessel - or another from the UK, the US, France, Japan or Germany - had done something similar to a Chinese aircraft in the South China Sea.

"So it was a dangerous act. These sorts of things can disable such aircraft and put those on that aircraft at great risk. So I thought it was a reckless and irresponsible act. And it should not occur," he said.

Defence Minister Peter Dutton described the laser pointing as "completely unacceptable" and a "very aggressive act".

The incident occurred in the middle of intense early election campaigning in Australia, with the Morrison government embarking on a risky anti-China scare campaign attacking Labor over its national security policies.

Despite concerns in defence and security circles, including from current and past ASIO heads, about stirring up a political wedge on national security, the Morrison government has continued to smash Labor daily over its stance on China. It has been describing Labor leader Anthony Albanese as weak, and as the Chinese government's preferred candidate at the coming election. Mr Morrison called deputy Labor leader Richard Marles as the "Manchurian candidate" in Parliament, although he then withdrew the remark.

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The Prime Minister did not name Labor or Mr Albanese when talking about China on Sunday, but continued pointing out what he regarded as differences between the government and the opposition.

"It has been our government that has stood up to these threats and coercion over many years now," he said.

"We have shown that resolve. We have shown that strength. And we've done it in the face of criticism, including here in our own country from those who think an appeasement path should be taken. I won't be intimidated by it. And the appeasement path is not something that my government will ever go down."

Mr Dutton rejected concerns raised by ASIO Director-General Mike Burgess and former ASIO boss Dennis Richardson about the politicisation of national security.

"I disagree with the conclusions that they are drawing," the Defence Minister told Sky News.

"And I think there is a big difference between the Coalition and Labor. I think the public recognise that, the public understand it. They have seen the actions of the Labor Party when they were in government when they lost control of the borders; I mean, if you can't stare down the people smugglers, how can you stare down the acts of aggression coming out of the Chinese government?"

Mr Albanese said Labor had not changed from a unified position on China. Instead, he said China had changed its ideology under President Xi Jinping.

"Whoever is in government will face a difficult task ahead in dealing with China," he said.

"What Australia needs to do, though, is to continue to stand up for Australian values, and that's something that we've done. It's important in order to do that, that there not be false distinctions raised which undermine Australia's unity, which doesn't serve the national interest or our purpose. It's very clear that that's the case."

The Chinese vessel was in company with another People's Liberation Army Navy ship at the time. They have since passed through the Torres Strait and are in the Coral Sea, according to Defence.

Mr Morrison said it was not the first time this sort of incident had happened, and Australia would be making its views "very, very clear" to the Chinese government through diplomatic and defence channels.

The Canberra Times has sought comment from the Chinese embassy in Canberra.

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