Prime Minister John Howard led with calls for the country's 300,000 Muslims to integrate fully into Australian society and adopt its values, sparking warnings that he was inciting racial violence.

Howard's remarks came at the end of a week, which saw 11 local Muslim men committed for trial on terrorism charges and a Muslim convert subjected to the first control order issued under controversial new anti-terror laws.

They also coincided with the arrest of 14 terror suspects in Britain, where the July 7, 2005 suicide attacks by young British Muslims that killed 56 people prompted Howard to express the fear that the same thing could happen in Australia.

"Fully integrating means accepting Australian values, it means learning as rapidly as you can the English language if you don't already speak it," Howard said in a radio interview.

"People who come from societies where women are treated in an inferior fashion have got to learn very quickly that that is not the case in Australia."

The head of the government's own moderate Muslim advisory committee, Ameer Ali, said Howard risked inflaming tensions seen in rioting between white youths and Arab-Australians in Sydney last December.

But the prime minister refused to apologise and repeated his comments in an article written for Sydney's Daily Telegraph tabloid on Saturday.

On Sunday, his heir-apparent, Treasurer Peter Costello joined the attack, saying Islamic leaders needed "to make it clear that terrorism is never justified under the cover of religion".

A minority in the Islamic community had been radicalised and was preying upon young people with dangerous ideologies, he said.

"It is very, very important that the leadership of Australia are very clear and very precise that this is not real Islam, that terrorism is always wrong."

The leader of the Islamic Friendship Association, Keysar Trad, told AFP the government was engaging in "gratuitous Islam bashing".

"On the radicalism issue, they have acknowledged that it is a small fraction of less than one percent," he told AFP.

But Attorney-General Philip Ruddock said Sunday the government believes Australia is vulnerable to terrorist attacks similar to those in Britain.

"What we're seeing in the United Kingdom is that there are numbers of groups, who it is believed, are intent on carrying out terrorist attacks in the United Kingdom," Ruddock said.

"This is of course the situation that we face. I think we became very complacent about these matters because we've not had on our own soil terrorist attacks."

Like Britain, Australia contributed troops to the US-led invasions of both Afghanistan and Iraq, but Ruddock denied that was a reason the country was a target.

On Friday, a Melbourne court ruled there was sufficient evidence to put on trial 11 Australian Muslim men arrested last November in Australia's biggest-ever counterterrorism operation.

The court heard they were inspired by Osama Bin Laden, had formed a terror cell and had been preparing a terrorist attack.

Earlier in the week the government used controversial new anti-terror laws for the first time to place a "control order" on a Muslim convert freed after his conviction on terrorism charges was quashed.

The order restricts the movements of Joseph "Jihad Jack" Thomas, 33, who had been convicted and sentenced to five years in jail for receiving money and an air ticket from Bin Laden's al-Qaeda.