Foreign Minister Julie Bishop now says Syria's president, Bashar al-Assad, must be part of any political solution to the nearly six-year-old war.
Her remarks come as peace talks resume in Switzerland.
Australia's position on Syria has long been to oppose the government of President Bashar al-Assad.
And, following the lead of the former Obama administration in the United States, Australia's stance has been that Mr Assad must step down for peace to return to Syria.
But after her first meeting with the new Trump administration officials at the White House, Foreign Minister Julie Bishop has now confirmed a critical shift in Australia's position.
Speaking in London after follow-up talks with British foreign secretary Boris Johnson, she says, despite Mr Assad's faults, there is no choice but to have him as part of Syria's transition.
"It's clear that President Assad will be part of the transition. The precondition that Assad must go has been a condition in place for some time, but most countries have moved on from that, and there's a recognition that President Assad, backed by Russia, will have to be part of a transition. And how long he remains will be a matter of negotiation."
Ms Bishop says a precondition that Mr Assad must go would only delay negotiations for a political solution now.
Her remarks leave a split between Australia and Britain, where Prime Minister Theresa May still maintains he cannot be a part of the solution.
But Australia's surprising position change does follow the lead of the United Nations, where many diplomats fear removing Mr Assad would leave a power vacuum as happened in Libya.
Talks aimed at achieving a political solution have resumed this week at UN headquarters in Switzerland.
Syrian negotiators have come face to face for the first time in three years.
The UN special envoy for Syria, Staffan de Mistura, says some progress has been made but he still does not expect a breakthrough.
"I'm not expecting miracles. We face an uphill task. It will not be easy. There is a lot of tension, and there is a lot of suffering that everyone has been bearing. But we must apply ourselves to this task."
The head of the opposition negotiating team, Nasr al-Hariri, says the focus must be on a political transition.
"To achieve a sustainable peace in Syria that guarantees what the Syrian people want, gives the Syrian national forces a possibility to fight terrorism, control the chaos present today in all the regions that the regime controls, or even in some regions that the regime does not control, to be able to do this, we must get over the main obstacle that has been facing us for six years. That is, the real political transition that satisfies the Syrian people."
Russia's ambassador to the United Nations, Alexei Borodavkin, says a solution can only come from direct talks between the Syrian parties.
"I think that the most optimal format of talks is direct talks. We have said this many times, and I reiterate: direct talks between the Syrian sides. The agenda of these talks is not yet ready, as far as I understand, the UN staff haven't finalised the preparation. But for us, it's important that it covers all the main points of UN Security Council Resolution 2254."
Staffan de Mistura has told negotiators to keep the interests of the Syrian people in mind.
"The Syrian people desperately want an end to this conflict, and you all know it, and you know it very well. You are the first ones to tell us this. They are waiting for a relief from their own suffering and dream of a new road out of this nightmare to a real and normal future in dignity -- Syrian people have a lot of historic dignity -- and a future that addresses their own legitimate aspirations for themselves and for their own country."
A separate set of negotiations in Kazakhstan, convened by Russia, Turkey and Iran, is dealing with the ongoing ceasefire and other humanitarian issues.
The Geneva talks are focused purely on a political solution.
Outside the UN headquarters, a group of Syrian mothers has met the delegations in protest.
The mothers have demanded the United Nations address the fate of those imprisoned by the Assad Government.
"Like we said in our demands, (we just want) a fair ... a justice for them. We just want to know if they are alive or dead. I just want to know that my husband is alive or dead. And if he's dead, I want to feel this sadness about him. I want to know if I should (be) waiting for him or not."
