Australia has committed its troops to fight against Iraq alongside the United States.
"This decision was taken at a cabinet meeting this morning following a further telephone discussion between myself and President Bush," Prime Minister John Howard said as protests began in a nation divided over the need for war.
UN weapons inspectors and other foreigners were scrambling to get out of Baghdad and Australia urged its citizens in Iraq and neighbouring Middle Eastern nations to leave.
Hours after committing its 150 elite SAS troops, jet fighters and warships already deployed to the Gulf, Australia expelled all Iraqi embassy staff, giving them five days to leave.
Foreign Minister Alexander Downer said the measure would contribute to the security of Australia and Australian forces fighting in Iraq.
Although Washington put the United States on the second-highest level of security alert and warned of possible attacks, Mr Howard said he was unaware of any reason to upgrade Australia's already heightened alert status.
Polls show that at least two-thirds of Australians oppose war in Iraq without UN backing, and Mr Howard said he was aware that the government's decision might upset many people.