The United Nations says there is work to be done to bring asylum seeker detention centres established by Australia up to required international standards.
The UN High Commissioner for Refugees has released reports after recent visits to processing centres in Nauru and Papua New Guinea, where refugees are transferred to from Australia.
The reports say the operational approaches and harsh physical conditions at both centres are not compatible with international law.
The high commissioner's regional representative, Richard Towle, told Radio New Zealand's Checkpoint programme on Wednesday that the detention environment is unsatisfactory.
"There must be in place and being implemented a range of effective protection mechanisms. The report identifies some good progress that's been made in some areas, but also some areas where there really needs a great deal still to be done to bring it up to required international standards."
The United Nations Refugee Agency considers the treatment of asylum seekers by Australia constitutes arbitrary, mandatory and indefinite detention in unsafe and inhumane conditions.
UN High Commissioner for Refugees officials inspected processing centres at Nauru and Papua New Guinea's Manus Island in October, AAP reports.
International protection director Volker Turk said the UNHCR understood Australia's determination to respond robustly to the challenges of people smuggling and dissuade people from dangerous sea voyages.
"Those responses must not neglect the compelling protection needs, safety and dignity of the individuals affected."
The UNHCR acknowledged some improvements, including better facilities and the start of processing on Manus. It also noted efforts made to improve conditions on Nauru, which was hot, had little privacy for people in tents following riots, cramped conditions and mosquitoes.
But the agency said Nauru was unsuitable for children who lacked access to adequate education and recreation facilities.
"UNHCR is of the view that no child, whether an unaccompanied child or within a family group, should be transferred from Australia to Nauru.''
At Manus, the UNHCR officials said there was a "pervasive" climate designed to encourage asylum seekers to choose to return home.
The report said UNHCR supported voluntary return for those fully informed and not in need of protection. But it said it was concerned that some bone fide refugees might consider return because of the harsh conditions, long delays in processing and uncertainty about the final outcome.