Federal Attorney-General Nicola Roxon concedes the Migration Act may have to be amended following the High Court's ruling paving the way for asylum seekers deemed security risks to be granted visas.
Immigration Minister Chris Bowen and his opposition counterpart Scott Morrison are due to sit down early this week to work out the details.
Ms Roxon said the government was still assessing the fallout from the High Court's decision concerning a Sri Lankan asylum seeker, known only as M47, but acknowledged the act could need tweaking.
"It could mean legislative change in the end," she told ABC Television on Sunday.
"I just think we need to get their full advice about the impact of the case.
"But I note that the coalition, in this instance, has already come out and said that they want to work with us on that."
M47 will have his visa application reassessed after the court ruled that the minister should not be automatically banned from granting visas to asylum seekers who've been given adverse assessments by the Australian Security Intelligence Organisation (ASIO).
The decision is likely to impact on another 50 or so asylum seekers, mostly Sri Lankans, who are in detention and have been given a black mark by ASIO.
Shadow attorney-general George Brandis believes public safety is at risk.
Senator Brandis said he was concerned that the court's decision left the government with no power to keep such asylum seekers out of the community, although Ms Roxon insists there is no danger.
"The court made clear that it's appropriate for this particular person ... to be kept in detention while the minister remakes his decision," Ms Roxon said.
"They expressly decided that, so I don't think there's need for alarm."
The coalition remains unconvinced, with Senator Brandis noting that the High Court made no ruling on the issue of indefinite detention.
If a deadline is imposed, the government could be forced to release asylum seekers into the community regardless of their security assessments.
Ms Roxon agreed that indefinite detention was an issue likely to be raised before the court in future.
She's denied the court's judgment means the 50 asylum seekers will all need to have their applications reassessed.