From nightmare commutes to pressure on essential services, Immigration Minister David Coleman says too many people are choosing to live in the same postcodes.
The government wants more skilled migrants to move to the regions and announced an increase in the total number of regional places in its migration program from 23,000 to 25,000.
The definition of "regional Australia" is also changing.
From the middle of next month, Perth and the Gold Coast will no longer be classified as "major cities".
Labor says the government previously said the Gold Coast's classification wouldn't change.
Opposition Leader Anthony Albanese questions the government's motives.
Immigration Minister David Coleman defends the decision.
Under the skilled migration program, migrants who live and work in the regions for at least three years are eligible for permanent residency.
International students in the regions will also be eligible to apply for more time in Australia on a post-study work visa.
Alexandra Long from the Multicultural Youth Affairs Network New South Wales says she hopes the right support is provided to ease the transition for students.
But Anthony Albanese says temporary visas should not be prioritised over giving unemployed Australians the support to fill jobs in regional Australia.
Meanwhile, Immigration Minister David Coleman acknowledges the total number of new migrants under Australia's permanent migration program last year was the lowest for 10 years.
But he says the $19 million invested into priority processing has seen a 124 per cent increase in the number of regional visas granted, compared to last year.
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