Three Chinese geostationary orbit satellites manoeuvred into position over northern Australia to monitor July's "Talisman Sabre" war games

Hundreds of smaller satellites are surveilling "Exercise Malabar", which involves warships from the US, India and Japan.

Experts say Beijing has extraordinary capability to gather intelligence on Australian military operations.

Commercial space data obtained by the ABC details the full scale of Beijing's surveillance on the recently completed "Exercise Talisman Sabre", as well as the "Exercise Malabar" naval drills now being held off Sydney.

In July, Canberra-based defence company EOS Space Systems tracked three Chinese geostationary orbit satellites manoeuvring into position below the equator to monitor the Talisman Sabre war games across northern Australia.

China's Shiyan 12-01 satellite was detected drifting westerly over the northern Australia region, while the Shijian-17 and Shijian-23 satellites were tracked drifting easterly to observe multiple areas where exercises were being conducted.

Since Exercise Malabar began on August 10, hundreds of much smaller low-orbit satellites (LEOs) have also been tracked completing thousands of flights at much lower altitudes over the Australian continent, focusing on the activity of warships around Sydney Harbour.

"We've been collecting optical surveillance data on Earth observing Chinese satellites during the Talisman Sabre and Malabar exercises and what that's showing is quite a lot of activity surveying the ground during those events," James Bennett from EOS Space Systems said.

"We've seen over 300 satellites surveying ground-based activities and the number of overflights is over 3,000 since the start of the Malabar exercise centred around the Sydney Harbour bay area," Dr Bennett added.

Exercise Malabar involves joint naval exercises between Australia and warships from the United States, India and Japan.

Space is considered an increasingly important domain for modern war-fighting operations across the globe, with Australia's recent Defence Strategic Review categorising it as a key element of a more integrated force.

The data on China's recent space activity was collected using telescopes stationed outside Canberra and at Learmonth in Western Australia, which was then analysed by EOS staff to precisely identify the satellites and their flight paths.

Dr Bennett said the large number of geostationary and low-orbit Chinese satellites currently above Australia is providing Beijing with extremely detailed and "persistent observation" of what is occurring on the mainland and offshore.

"They can glean military intelligence on what the capabilities and equipment are, as well as processes of ground military activities; they can use this to drive a fair bit of intelligence on military operations in Australia."

The Defence Department has declined to give details on how it was monitoring and mitigating any risks posed by the substantial Chinese satellite activity over Australia during what it describes as "well-publicised, complex war-fighting exercises".

"The ADF takes prudent measures to safeguard the information security of Australian and participating forces," a defence spokesperson told the ABC.

"Defence tracks satellite movements as part of broader space domain awareness efforts."

James Brown, the chief executive of the Space Industry Association of Australia, said the numbers of Chinese satellites dedicated to tracking the military exercises is in line with Beijing's growing presence in space.

"We've seen an extraordinary amount of Chinese intelligence surveillance and reconnaissance satellites being launched in recent years and Australia is a target for all that activity; space is becoming a critical domain for any future conflict and any potential conflict," he said.

"They have hundreds of military and intelligence satellites which are not only collecting on Australia and its allies but in some cases dazzling Australian and allied satellites and manoeuvring closely to other satellites.

"Australia by contrast doesn't own any military satellites and certainly doesn't have any capability to collect the sort of imagery that China's been collecting over Sydney Harbour this week."

In June, Labor announced it would scrap a Morrison government program to develop new Australian satellites to gather data on natural disasters, agriculture and marine surveillance, as it searches for budget savings.

"The irony being that whilst China has had 300 satellites focused on collecting observation data Australia this week, our own government just cut the program that would've given us our first four able to do the same thing," Mr Brown said.