Scott Parkin, of Houston, Texas, was interviewed on national television as one of the leaders of a recent street protest in Sydney against Halliburton's commercial interests in war-torn Iraq.
The demonstration was one in a series of rallies against the Iraq war, corporate greed and greenhouse gas emitters that coincided with the three-day annual Forbes Global CEO Conference at the Sydney Opera House in August.
Attorney General Philip Ruddock said Parkin's tourist visa was cancelled because of security concerns.
"The decision was based upon a security assessment, and security assessments are not matters about which I can comment in any detail," Ruddock told Australian Broadcasting Corp. television.
Parkin was being detained in a police cell in Melbourne on Sunday.
"Scott Parkin is effectively Australia's first genuine political prisoner"
"Scott Parkin is effectively Australia's first genuine political prisoner," protester Dan Cass told Ten Network television.
Parkin's lawyer Marika Dias confirmed her client's six-month visa had been cancelled on Saturday on security grounds.
Parkin was apprehended by six federal police and immigration officials in a cafe in the southern city of Melbourne on Saturday, she said.
On Wednesday last week, he exercised his legal right to refuse an interview request from the nation's top spy agency, Australian Security Intelligence Organisation, she said.
"The grounds that he has been given for cancelling the visa are that on September 8 the Department of Immigration was advised by the competent national authority that he was directly or indirectly a threat to Australian national security," Dias said.
"One can only presume the authority is ASIO under the circumstances," she added.
She said Parkin had been given no information about why he was regarded as a security threat.
"One can only assume what is causing concern is his protesting and his activism, which is a significant worry for the rest of us if people who are involved in nonviolent, political dissent are being deported," Dias said.
Dias said Parkin was considering appealing his deportation but would have to pay 130 Australian dollars (US$101) a day for his detention pending a government tribunal reviewing the deportation order.
If he decides to accept the deportation, he could leave the country within days, she said.
Dias said Parkin arrived in Australia in June, has not breached the conditions of his visa and is not suspected of breaking any law.
Australia is a staunch supporter of the US-led "war on terror" and sent 2000 troops to back American and British forces in the March 2003 Iraq invasion.