Asylum-seekers are denied basic rights when in detention, advocates say, but an independent MP's bill could make it illegal to hold them for more than 90 days or put children in these facilities.
Australia is often viewed internationally as a pariah on refugee rights and Asylum Seeker Resource Centre director Jana Favero says the nation is in a "crisis of detention".
Forty-six people are stuck in Papua New Guinea, while another 94 are being held in detention on Nauru.
There are over 900 people in immigration detention centres, according to Department of Home Affairs figures.
On-shore asylum-seekers spend an average of 565 days in immigration detention - substantially more than countries such as Canada (30 days) and the United States (48 days).
"There is no future, there's no certainty for how long they will be there," Ms Favero told reporters in Canberra.
"Every day in detention is a denial of freedom and denial of basic liberty and human rights."
The centre presented an 11,000-strong petition in parliament calling for the immediate evacuation of nearly 140 people held in offshore detention.
Many detainees are reporting mental health issues and there are concerns about offshore deaths as transfers to Nauru resume.
But, on Monday, independent MP Kylea Tink reintroduced a private member's bill to the House of Representatives in an attempt to "put an end to Australia's uniquely cruel immigration detention regime".
"We are still a nation that has one of the worst reputations globally in terms of meeting our international human rights obligations," she said.
"There is an expectation from the broader Australian population ... that it's not OK to hold people indefinitely and that it's not OK for our government to hold children."
The Migration Amendment (Limits on Immigration Detention) Bill 2024 amends the Migration Act 1958 to ensure Australia complies with global human rights obligations, she said.
Private-member bills rarely advance in parliament.
In a landmark decision in November, the High Court ruled that non-citizens could not be kept in indefinite immigration detention, which has led to the release of some 150 detainees.
Ms Tink's bill clarifies that once a person has been held for 90 days, their detention can be extended by a further 28 days if deemed necessary as a last resort.
She said that was a practical solution for the Administrative Review Tribunal to assess applications.
Ms Tink said no children should be placed in centres which have been described by experts as "factories for producing mental illness".
The bill has also been updated to include offshore detention within its scope.
"We need to decide as a nation where we stand in terms of our humanitarian principles and we need to apply those consistently," Ms Tink said.
Asked if a cabinet reshuffle had made Labor more amenable to her proposed reforms, the independent MP said the situation did not seem like it had changed.
"There is no indication from this government that they are finally prepared to step in and put an end to this policy," she said.
"This is not a carte blanche opening of our borders.
"It is us recognising that, as a nation, we have obligations under international human rights to treat everybody with respect, to treat everybody in the same way that we wish to be treated if we ended up in a situation where we had to flee our own shores."
