Prime Minister Scott Morrison says an eight-year-old report claiming he once urged the Coalition to score political points with Muslim immigration is an "ugly and disgusting lie".

The story, which was published by The Sydney Morning Herald in 2011 when Mr Morrison was Tony Abbott's immigration spokesman, has been widely shared after TV host Waleed Aly alluded to it during an editorial about Friday's shooting massacre at two mosques in New Zealand.

After intially declining to comment when the story was published, the Prime Minister later denied he told shadow cabinet to capitalise on the electorate's concerns about "Muslim immigration", "Muslims in Australia" and the "inability" of Muslim migrants to integrate, but on Wednesday went on the attack when pressed again over whether he made the comments.

"It is a disgraceful smear and an appalling lie," Mr Morrison told ABC TV, noting he had a history of working with the Islamic community as a public figure.