Pro-Palestine protesters have marched in small numbers in the wake of a contentious plan to combat anti-Semitism including the assertion funds should be stripped from non-compliant arts bodies.
The recommendation to axe support for publicly funded institutions and festivals that promote or fail to effectively deal with hate speech features in a report by Australia's anti-Semitism envoy Jillian Segal.
The federal government is considering the advice in a bid to combat growing discrimination against Jewish Australians.
Criticism of the report has also focused on Ms Segal's recommendation Australia adopt the International Holocaust Remembrance Alliance's definition of anti-Semitism, some arguing that it conflates the notion with criticism of Israel and Zionism.
While "unequivocally" condemning anti-Semitism, the Australian Federation of Islamic Councils says it is deeply concerned by the report.
"This plan, drafted by a politically appointed, unelected official, risks undermining free expression, marginalising already vulnerable communities and conflating legitimate criticism of the State of Israel and its policies with anti-Semitism," it said on Saturday.
"Combating anti-Semitism is a shared responsibility but it cannot come at the cost of justice, free speech and the equal treatment of all communities," council president Rateb Jneid added.
Racial justice organisation Democracy in Colour said the swift establishment of resources, recommendations and government attention for combating anti-Semitism stood in stark contrast to responses to other forms of racism.
The "selective urgency" exposed a "hierarchy of racism that continues to operate within our democratic institutions".
"The government's response pattern reveals a concerning truth: some forms of racism receive red-carpet treatment while others are relegated to performative gestures and token appointments," director Noura Mansour said.
About 50 diehard protesters gathered in central Sydney on Saturday afternoon in opposition to the Palestinian-Israeli conflict and what they argue is Australia's wrongful participation in it.
The mostly silent action, outside the offices of defence contractor BAE Systems, continued months of similar demonstrations which have been staged in capital cities at weekends.
A larger protest has been scheduled for Sunday in the city's Hyde Park and another will go ahead in Melbourne.
Prime Minister Anthony Albanese said on Friday steps were already being taken to silence the behaviour Ms Segal had identified, pointing to a decision to block controversial US rapper Kanye West from entering the country after he released a song titled Heil Hitler.
"We screen people ... when they apply for visas it's something that we make sure that we represent Australia's national interests," he told reporters.
Ms Segal said criticisms of her findings misunderstood the Holocaust Remembrance Alliance definition of anti-Semitism.
"(It) clearly says if Israel is criticised, that's absolutely fine - and indeed, so many Israelis are criticising the policies of their own government," she told ABC Radio.
Several other Jewish groups called for her recommendations to be adopted in full.
They include embedding Holocaust education into school curriculums and strengthening legislation against hateful conduct, in addition to terminating or withholding funds from universities, broadcasters and cultural institutions that fail to address anti-Semitism.
Ms Segal's report found threats, vandalism and physical violence against Jewish Australians tripled between October 2023 and September 2024.
Australia's government-appointed envoy to combat Islamophobia, Aftab Malik, says he will soon provide "comprehensive" recommendations to the prime minister.
