Mr Dutton said the ship, which has intelligence gathering capabilities, had come into Australia's exclusive economic zone and was "hugging the coastline".

Speaking at a press conference on Perth, Mr Dutton said the ship was sighted on Friday at 6am, about 250 nautical miles northwest of Broome.

"It is unusual in terms of the way in which it has come so far south, and the way it's hugging the coastline as it heads up in the direction of Darwin," he said.

"It is an aggressive act particularly because it has come so far south - for it to come south of Exmouth is without precedent."

Mr Dutton said Australian authorities were monitoring the situation closely, with planes and other surveillance equipment monitoring the vessel.

The ship was being tracked over the past week, but Mr Dutton did not state when he was first alerted to the vessel's presence.

The Department of Defence confirmed the ship was a Dongdiao class auxiliary intelligence ship called Haiwangxing (Neptune), which was also spotted off the Australian coast in 2021.

The ship travelled down the west coast towards Exmouth before tracking east along the country's northwest coast.

"Australia respects the right of all states to exercise freedom of navigation and overflight in international waters and airspace, just as we expect others to respect our right to do the same," a defence spokesman said.

"Defence will continue to monitor the ship's operation in our maritime approaches."

Despite the timing of the announcement eight days out from the federal election, Mr Dutton said the announcement had nothing to do with the campaign.

"We've had vessels in our waters this year and we've made the public aware of those," he said.

"Australians deserve to know what is taking place."

Australian Associated Press