Scott Morrison has downplayed tensions with the new NSW premier, but hasn't denied launching verbal volleys during a heated exchange.
The prime minister is adamant he has a strong working relationship with Dominic Perrottet, who became the state leader on Tuesday.
Mr Morrison was quizzed about reports he hurled an "f-bomb" at Mr Perrottet in a fiery private meeting about coronavirus support.
"We've got an honest relationship. When we disagree, we disagree. But the next day we get back to work," he told the Nine Network.
He described the pair's robust disagreement as signs of a "real relationship" between people strongly advocating positions.
In a separate interview, Mr Morrison said he wouldn't go into the issue after being asked if he told the then NSW treasurer to "f-off".
"We were talking through some issues to do with support, and we've been working a lot on them," he told KIIS FM.
While treasurer, Mr Perrottet clashed with the federal government over its refusal to reinstate JobKeeper wage subsidies.
The prime minister denied he described Mr Perrottet as painful to deal with.
He pointed to $6 billion in COVID worker support for NSW as a sign of what working together had achieved.
Mr Perrottet replaced Gladys Berejiklian, who last week quit after the NSW Independent Commission Against Corruption launched an investigation into her conduct.
Ms Berejiklian has been floated as a potential candidate for former prime minister Tony Abbott's old seat of Warringah, held by independent Zali Steggall.
Mr Morrison said her priority would be dealing with issues stemming from ICAC, but he was devastated she decided to leave politics.
On a switch to federal politics, he was circumspect but insisted the former premier had a lot more to contribute to public service.
"Doesn't necessarily need to be in an elected office or something like that," he told 6PR radio.
"But if that's what she'd like to do, then I'm sure there'll be plenty of opportunities."
Senior NSW cabinet minister Andrew Constance, who is quitting state politics for a federal tilt, believes Ms Berejiklian would be a major asset in Canberra.
"If Glad can get cleared up, whatever these issues are, you know, through the public hearing process, I think she'd be unreal," he told ABC radio.
"Do I think she's got the capacity to be prime minister of Australia? You bet."
Ms Berejiklian resigned after ICAC revealed she was under investigation for potential breaches of public trust during her secret five-year relationship with former Liberal MP Daryl Maguire.
