Under the changes, gay couples in long-term relationships would be treated the same as married couples on issues such as taxation, pensions and welfare payments, Attorney General Robert McClelland said.
Gay marriage is a hot-button issue for many Australians, and gay rights advocates say it is a key test of authorities' willingness to end discrimination.
But McClelland said the Marriage Act would not be among the laws changed.
"The government believes that marriage is between a man and a woman," he said.
The changes - to about 100 different laws - will begin being introduced to Parliament next month, and the process is expected to be completed by mid-2009, McClelland said.
Some examples of the changes include that children being reared by gay couples would be considered dependents of both adults for tax and unemployment benefits, and same-sex couples would be treated as a family unit for pension purposes.
Rights advocates welcomed the changes, though they said the government should go further and recognize gay marriages.
"Gay and lesbian Australians will not be fully equal until we are allowed the right to marry the partner of our choice," Rodney Croome of the Australian Coalition for Equality group told the Australian Broadcasting Corp.
The Most Rev. Peter Jensen, the Anglican archbishop of Sydney who is a vocal opponent of gay marriage, said people in platonic relationships deserve the same benefits as gay couples under the law reforms.
"I hope this is not just pro-gay, so to speak, but pro-people ... in order to make sure there is justice for all Australians," Jensen told Australian Broadcasting Corp. radio.
He said friends living together in long-standing platonic relationships "support and strengthen each other."
"There'd be many Christian people living like that, and I think that sort of thing could also be recognized," Jensen added.
The changes will bring the federal government more closely into line with state and territory governments, which have already passed laws recognizing same-sex couples in their jurisdictions.
Under state laws, long-term gay couples are recognized as de facto partners with some legal rights. But the federal Marriage Act defines the union as between a man and a woman.
Australia is in line with many countries in Europe that give some legal recognition to same-sex couples - though few recognize gay marriages. In the United States, state bans on same-sex marriages or unions are widespread, though domestic partnerships are recognized in some places.