Prime Minister Tony Abbott said that the risk of having a humanitarian aircraft being shot down by the Islamic State is just one part of the overall risks involving the aid mission.
However, these risks are reasonable given the importance of the mission, he said.
ISIS had reportedly shot an Australian aircraft C-130, but missed it, as it flew in low to drop humanitarian aid to people in the town of Amirli in northern Iraq.
Speaking on Macquarie Radio, Mr Abbott said he had not received any advice yet that the C-130 was shot at.
There are information of fire across the region from which it is conducting humanitarian air drops, but there had been no advice yet that these fires were deliberately aimed at the aircraft.
He assured everyone that all possible threat were weighed up before flying in Australian troops to Iraq.
As for the C-130 Hercules, he said that it is armed with missile counter measures. He however added that there can be no perfect counter measure to an attack.
In a statement from the Department of Defence, it said that its humanitarian air drop in Iraq follows a strategy being done by The United States, Albania, Canada, Croatia, Denmark, Italy, France, and the United Kingdom.
Defence confirmed that the second humanitarian air drop was successful as the Royal Australian Air Force C-130J Hercules aircraft was able to deliver 15 bundles of Australian humanitarian supplies to isolated civilians in the Northern Iraqi town of Amirli. The supplies included high energy biscuits, bottled water and hygiene packs which are designed to feed and hydrate 2600 people for 24 hours.
"The Australian Defence Force stands ready to provide further air-lift assistance to Iraq with the movement of stores including arms and munitions," the statement reads.
All humanitarian contribution that will be coming from Australia will be properly coordinated with the Iraqi government. It has to be in tune with regional goals and other objectives set by Australia's international partners, Defence underlined.
Defence hopes that its effort will be beneficial to help the people of Iraq to confront the threat of ISIL extremists. The department also aspires to stop the humanitarian crisis from deepening.