Australia has overturned a controversial plan to segregate people in Canberra's Parliament House wearing burqas and niqabs, body and facial coverings used by some Muslim women.

People wearing facial coverings will now be able to sit in the public gallery but will have to show their face when entering Parliament said Senate President Stephen Parry on Monday.

The Department of Parliamentary Services said in a statement Monday anyone wearing a burqa and trying to enter Parliament House will be now asked to "temporarily remove" their facial covering.

"This will enable DPS security staff to identify any person who may have been banned from entering Parliament House or who may be known, or discovered, to be a security risk," the statement said.

"Once this process has taken place, visitors are free to move about the public spaces of the building, including all chamber galleries, with facial coverings in place."

The plan to make Muslim women wearing burqas and the niqab sit in glassed enclosures at Parliament House had been implemented without prior advice from security agencies, the Sydney Morning Herald reported.

The decision to segregate women wearing the burqa was immediately condemned by the human rights and race discrimination commissioners.

Palmer United Party Senator Jacqui Lambie, however, said dropping the burqa ban was an act of encouragement for Islamist extremists.

"The decision today to allow burqas and other forms of identity concealing items of dress to be worn in Australia's Parliament will put a smile on the face of the overseas Islamic extremists and their supporters in Australia," she said.