A third Melbourne council has voted to abandon official Australia Day celebrations — but, unlike some of its neighbours, will retain a citizenship ceremony on the date.

After more than an hour of debate, Moreland council voted 7-4 to join nearby Yarra and Darebin councils, in the city's north, in dropping all references to Australia Day on January 26.

The motion states the council believes it is not an appropriate date for an inclusive national celebration as "January 26 marks the beginning of the British invasion of Aboriginal and Torres Strait Islander lands and oppression of the Aboriginal and Torres Strait Islander people".

Moreland says it will now officially support the #changethedate campaign and host a culturally appropriate event on a date to be agreed upon by the Moreland Reconciliation Working Group.

But in a break away from its neighbours, Moreland narrowly voted to reaffirm its commitment to hosting a citizenship ceremony on January 26.

One of the councillors said she would support the amendment to try to protect the council's right to hold the ceremony after the Federal Government stripped Yarra and Darebin of their right to host the ceremonies.

Councillor Ali Irfanli told the meetings the ceremony was critical in welcoming new migrants into the community.

"I also think that it's an opportunity with the Aboriginal welcome on that day for the oldest Australians to inform the newest Australians of the plight and the difficulties that day has for them and their history," added councillor John Kavanagh.

Vocal members of the community packed the public gallery and at one stage the mayor was forced to threaten to remove members of the community who shouted at councillors during the debate.

'It's not right'

The divisiveness of the issue was evident from the beginning of proceedings when two Indigenous leaders addressed the meeting, voicing opposing views.

"How dare you actually take away Australia Day," said Wurunderji elder Ian Hunter.

"We are all Australians here. To take those things away from us whether we be Indigenous or non-Indigenous, it's not right."

But Dja Dja Wurrung elder Gary Murray says Australia Day signifies the beginning of the decimation of Indigenous clans.

"Why would black people, Aboriginal people, celebrate a holocaust?" he asked the councillors.

"There's no shame in having courage to make hard decisions and you want a treaty with First Peoples in this state, whether it's a state government one, a federal government one or a Moreland one, you have to stand up, you have to stand tall, stand straight and be honest with First Peoples."

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The motion was proposed by Greens councillor and deputy mayor Samantha Ratnam.

She told the meeting it was not about erasing history but acknowledging all of Australia's past.

"Thousands of Australians like me want to celebrate Australia Day, just not on a day that's so painful for others."

Several councillors said they believed it was not the role of councils to debate the date of Australia Day.

"This issue is splitting a nation," said Cr Oscar Yildiz.

"We should not be making decisions that our federal politicians are delegated to make."

"In response to Cr Yildiz's comment 'roads, rates and rubbish', if I hear that one more time, I'm going to bash my head against a wall," councillor Dale Martin responded.

"There are another 364 days in the year we could choose from," he said.

In 2015, Moreland Council moved its Australia Day Awards to October and renamed them the Moreland Awards.