Australia on Wednesday listed all of Hezbollah as a "terrorist organization", extending an existing ban on armed units to the entire organization, which wields considerable power over Lebanon.
Home Affairs Minister Karen Andrews said that the Iran-backed Shi'ite group "continues to threaten terrorist attacks and provide support to terrorist organizations" and poses a "real" and "credible" threat to Australia.
Hezbollah has been designated as a terrorist group by parts of the West, although some countries have been reluctant to sanction the group's political wing, fearing it could destabilize Lebanon and hamper contacts with authorities.
Hezbollah defies easy definition -- acting as part political party, part militant organization and part provider of basic services to Lebanon's Shi'ite community.
It is the only side that has to date refused to disarm since the country's devastating civil war ended in 1990.
Membership of the organization or providing funding for it will now be proscribed in Australia, which has a large Lebanese community.
No reason was given for the timing of the move, which comes as Lebanon reels from spiraling political and economic crises.
Nearly 80 percent of the population is estimated to be living below the poverty line.
Elections are expected in March 2022 and there is growing public anger about nepotism and corruption among Lebanon's ruling class.
Prime Minister Naftali Bennett welcomed the move and thanked his Australian counterpart Scott Morrison.
"I welcome Australia’s intent to declare Hezbollah a terrorist organization in its entirety," he said on Twitter. "Hezbollah is an Iranian-backed terror organization in Lebanon responsible for countless attacks in Israel & around the world."
Foreign Minister Yair Lapid also thanked the Australian government for its decision, saying Canberra is a "close friend of Israel in the fight against global terrorism."