Australia's spy chiefs fear the Federal Government's ability to strip terror suspects of citizenship might increase the global threat of terrorism.

Key points: ASIO warns stripping terror suspects of citizenship may have "unintended outcomes"

ASIO warns stripping terror suspects of citizenship may have "unintended outcomes" The agency says cancelling suspects' citizenship will not eliminate the threat the pose

The agency says cancelling suspects' citizenship will not eliminate the threat the pose A parliamentary committee is currently reviewing the laws

The Australian Security Intelligence Organisation (ASIO) has raised concerns with laws which target dual citizens linked to terrorism both in Australia and abroad.

Parliament's powerful intelligence and security committee is reviewing the laws, which ASIO argued might intensify other terror activities.

In a submission, the agency urged the Federal Government to use the powers sparingly, fearing unintended consequences.

"In a globally interconnected world, the location of an individual offshore as a result of citizenship cessation will not eliminate any direct threat they pose to Australian (or other) interests overseas," an ASIO submission to the inquiry said.

"It will not prevent their reach-back into Australia to inspire, encourage or direct onshore activities that are prejudicial to security — including onshore attacks.

"In some instances, citizenship cessation will curtail the range of threat mitigation capabilities available to Australian authorities.

"It may also have unintended or unforeseen adverse security outcomes — potentially including reducing one manifestation of the terrorist threat while exacerbating another."

ASIO is broadly in favour of increased powers to monitor suspected terrorists, but the agency said powers to revoke citizenship should be used carefully.

"There may be occasions where the better security outcome would be that citizenship is retained, despite a person meeting the legislative criteria for citizenship cessation," the agency said.

"For example, where the Australian Federal Police has criminal charges that could be pursued if the person were to remain an Australian citizen."

The spy agency's submission followed criticism from the Independent National Security Legislation Monitor (INSLM), which warned of major flaws with the powers, including that they made gathering evidence for later prosecutions more difficult.

ASIO said there had been about 230 Australians who had travelled to Syria and Iraq to fight with extremist groups since 2012, and around 80 were known to still be in the region.