About 400 asylum seekers have been released from detention in Darwin after being granted bridging visas.
They were flown to Sydney on Thursday and will be settled in all the states and territories, with most going to Victoria, New South Wales and Queensland.
An Immigration Department spokesman said the group included people who had been in detention for months, and more recent arrivals.
"This is part of the department's ongoing routine transfer of people in detention onto bridging visas. The people are a mix of those who have arrived both before and after August 13."
But those who arrived after the government's tough no-advantage policy for boat arrivals took effect on August 13 will not be allowed to work, the spokesman said.
"Consistent with the government's no-advantage principle, those who arrived after August 13 will have no work rights attached to their visas and they will only receive basic assistance."
The department warned that people released on bridging visas could still face transfer to Nauru or Manus Island at any time.
Opposition immigration spokesman Scott Morrison told Sky News every bridging visa issued was "an admission of failure of the government's policy".
"It means their detention network can't hold them [and] they can't send them to Nauru because their deterrence policies are non-existent."
Meanwhile, the government has expelled another 46 asylum seekers from Sri Lanka, all recent arrivals from a number of boats.
While advocates and asylum seekers accused the government of sending people home without properly investigating their claims for asylum, Immigration Minister Chris Bowen said: "The government will continue to return people where they do not engage Australia's international [protection] obligations."
Earlier, he told ABC Radio that many of the Sri Lankans forcibly returned to their home were economic migrants. "This is a very appropriate process," Mr Bowen said.
"It's a process which does make sure that where people come to Australia for economic purposes, which is being sold by people smugglers – 'You can go to Australia; even if you are eventually returned after several years you'll be able to work' – this is one of the mechanisms we are using to deal with that."