The case against an Australian man being held on drug trafficking charges in Malaysia has been referred to the country's high court.

Tests have confirmed the quantity of drugs allegedly seized from Dominic Bird exceeds the death penalty threshold.

Bird, formerly from Perth, was arrested in March after allegedly selling methamphetamine to an undercover police officer in Kuala Lumpur.

Bird entered the court shackled to 10 other prisoners, however he appeared in good spirits waving to lawyers and family.

His father struggled to hold back tears during the hearing.

Tests on drugs allegedly seized from the 32-year-old have returned a weight of 168.7 grams.

That is well in excess of the 50-gram threshold which defines trafficking under Malaysian law.

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Bird's lawyers say they are prepared to defend him against a mandatory death penalty.

Barrister Muhammad Shafee says the defence will question the credibility of the police who conducted the undercover sting and says there is doubt over who was in possession of the drugs.

"We think there's more than enough doubt that has been raised pertaining to who actually would have been in possession of it," he said.

"And coupled with that, we are not impressed at all with the credibility of the arresting officers."

Three Australian men have been executed in Malaysia for drug trafficking in the past 25 years.