Illegal offshore gambling websites ripping off Australians will be blocked under new measures announced by the Federal Government.

Key points: Illegal offshore gambling websites are not licensed or regulated in Australia

Illegal offshore gambling websites are not licensed or regulated in Australia This means they do not have consumer safeguards in place and that they do not pay tax, the Communications Minister has said

This means they do not have consumer safeguards in place and that they do not pay tax, the Communications Minister has said Legislation strengthening the Australian Communications and Media Authority's power over illegal gambling sites was passed in 2017

Communications Minister Paul Fletcher said too many people were losing money through more than 1,000 sites which targeted them with misleading incentives.

"There's quite a regular stream of complaints from Australians who place bets on these sites and when they win they find it very difficult to collect their money," he said.

"So these sites will take real money, but they won't pay out.

"They're not licensed or regulated in Australia. That means they don't have consumer safeguards in place, it also means they're not paying any tax and they're not contributing towards, for example, the cost of regulating the racing industry in Australia."

Powers to be used by the Australian Communications and Media Authority (ACMA) for the first time would allow it to block access to illegal sites once an investigation has been carried out.

"It will be moving quickly to block at least one website in the short term and it will be actively exercising its powers in response to complaints," Mr Fletcher said.

The move follows a review by former New South Wales premier Barry O'Farrell in 2015 which recommended blocking illegal gambling websites.

Legislation strengthening ACMA's powers was passed in 2017 and Mr Fletcher said an arrangement had also been now reached with internet service providers.

"This is not a silver bullet but it's part of a whole range of measures that we have taken since the O'Farrell review.

"Whenever an area is regulated by both the Commonwealth and states and territories, as is the case for gambling, it requires the Commonwealth and state and territory governments to work together to agree the arrangements and that takes some time."

The Government estimates Australians spend up to $400 million on illegal gambling websites each year, amounting to $100 million in lost tax revenue.