Transport Minister John Anderson has warned Australians that their trains, buses and railway stations could be terrorist targets - and urged travellers to watch out for suspicious packages.

Mr Anderson said that after the Madrid railway bombings, which killed 191 people in March, ASIO had briefed him and state and territory transport ministers on the threat to all modes of transport.

The legislation will increase the time that police forces can hold suspects for questioning during terrorism investigations from four to 24 hours.

And while it is already a crime to be a member of an organisation formally listed by the Government as a terrorist group, the new law will make it illegal to be a member of a group involved in terrorist activity, whether it is listed or not.