Vilification on the grounds of religion is now illegal and in serious cases could result in a criminal conviction with a fine of up to $7500, under laws passed by the ACT parliament on Thursday.

Both Labor and Liberal supported the move put by the Greens Shane Rattenbury, who said the display of hatred, intolerance and offensive behaviour towards Muslims was one of the biggest intolerance issues in Australia today.

The ACT has outlawed vilification of people because of their religion, concerned about growing attacks on Muslims.

The University of South Australia had found about 10 per cent of Australians were highly Islamophobic, and while the ACT showed the lowest rates in the country, Islamophobia was still significant here.

"It is clear [Muslims] are frequently, almost constantly, exposed to discrimination, vilification and targeted offensive behaviour," he said.