Children are using AI-driven chatbots for hours daily, giving them interactive access to unrestricted themes from sex to drug-taking, self-harm, suicide and serious illnesses, such as eating disorders.
The first of eSafety's new Online Safety Advisory series warns chatbots are exposing children to unmoderated conversations which may encourage or reinforce harmful thoughts and behaviours.
eSafety Commissioner Julie Inman Grant said most AI-driven chatbots were not designed with safety in mind and children were not developmentally ready for the risks.
"AI companions can share harmful content, distort reality and give advice that is dangerous," she said.
"In addition, they are often designed to encourage ongoing interaction, which can feel 'addictive' and lead to overuse and even dependency.
"It's time for big tech to move on from the era of 'moving fast and breaking things', especially when it come to our children.
"The industry must embrace Safety by Design as an immediate priority to anticipate risks and ensure products are safe from the outset.
"In the meantime, eSafety offers information, support and advice through eSafety.gov.au, including our new Online Safety Advisories," Ms Inman Grant said.
eSafety's Online Safety Advisories will provide fast and expert-driven insights into emerging online risks.
They will offer clear and practical support to help Australians the challenges of digital wellbeing, especially parents, carers, educators, and policymakers.
"Keeping up with emerging online risks can be challenging for parents and carers," Ms Inman Grant said.
"That's why the Online Safety Advisories will provide expert guidance that is practical, timely, and easy to apply. Families can use this advice to make informed choices about their children's digital lives.
"The digital world should be a place for exploration and connection, not exploitation. Online safety isn't just about avoiding harm. It is also about having the right information to navigate these technologies with confidence," Ms Inman Grant said, adding that while education and awareness are critical, the burden of online safety must not fall solely on parents and individuals.
"We need a holistic approach to online safety, one that doesn't just rely on parents to monitor every digital interaction. The companies profiting from these technologies must do more to build safety into their platforms from the start, rather than applying fixes after harm has occurred," Ms Inman Grant said.
The first Online Safety Advisory can be found at Advisories and blogposts | eSafety Commissioner.