The opposition Labor Party was deciding on Thursday whether to back the proposal.
The left-wing Greens Party planned to formally propose a Senate inquiry next week following allegations by an Australian released from Guantanamo Bay in January that he had been sent to Egypt to be tortured.
The Egyptian-born Australian, Mamduh Habib, said in a television interview aired by Australian public broadcaster SBS on Wednesday that Egyptian interrogators who allegedly tortured him had been briefed by Australia's secret service.
His allegation raised fresh questions about Australia's knowledge of abuse.
The Greens would need the support of Labor as well as other opposition parties and independent senators for the inquiry to be established, because government senators are set to oppose it.
The government does not hold a majority of seats in the Senate.
Labor's foreign affairs spokesman Kevin Rudd said Labor lawmakers were considering their position on a Senate inquiry, saying such an investigation would involve sensitive intelligence matters.
"Whether in fact a Senate inquiry is the appropriate place for that to occur, we're still working our way through this question," Rudd said on Thursday.
Habib was released without charge from the US military base in Cuba more than three years after his arrest in Pakistan in October 2001.
Habib said he was sent to Egypt three weeks after his capture, where he was allegedly tortured daily for six months before arriving at Guantanamo Bay early in 2002.
Rudd said the government should ask the United States why it sent Habib to Egypt.
"I ask questions to which I realistically expect I'm going to get an answer and I don't think I'd be going to get an answer"
Philip Ruddock, attorney-general
"It is important that the government provide all relevant information to the Australian people on this," he said.
The government has said it thought Habib was sent to Egypt from Pakistan, although Egypt has declined to confirm this.
The government says it does not know how he got there, although Pakistani Interior Minister Makhdum Syid Faisal Salah Hayat told SBS last year that Washington sent him.
Attorney-General Philip Ruddock said Australia had not asked the United States whether Habib had been sent to Egypt to be tortured because he did not think the Americans would reply.
"I ask questions to which I realistically expect I'm going to get an answer and I don't think I'd be going to get an answer," Ruddock told SBS.
US Attorney-General Alberto Gonzales said this week that before the US hands over terror suspects to foreign governments, it receives assurances they will not be tortured.
Human rights advocates allege that the US government is getting foreign governments to apply torture to elicit information that could not be obtained legally in America.