Howard told reporters on Wednesday that the federal government would consider joining an appeal against the ruling expected to be lodged by the government of Western Australia, of which Perth is the capital.
"My initial reaction is one of some considerable concern," he said.
The landmark judgement marks the first time that a large metropolitan area in Australia has been ruled to belong to the indigenous people who lived there before white settlers arrived, lawyers said.
The decision, which sent lawyers, homeowners and officials scurrying to assess the impact, could lead to similar claims over other cities such as Sydney and Melbourne, native title specialist lawyer Christine Lovitt told AFP.
Homeowners and businessmen, holding freehold title to their properties, were assured that the ruling by Judge Murray Wilcox on Tuesday did not mean they could be evicted.
Wilcox said the decision to grant native title was "neither the pot of gold for the indigenous claimants nor the disaster for the remainder of the community that is sometimes painted".
Alan Eggleston, Western Australia Senator, attacked the ruling, saying it "really could have quite profound and significant implications and change our way of life".
Proven native title
The judge found that the Nyoongar people had proven native title over more than 6,000 square km covering Perth and its surroundings by continuing to observe traditional customs despite being largely dispossessed by white settlement in 1829.
"The outcome was probably a little surprising for most people because one would have thought in a highly developed area that the native title claimants would probably have lost their connection to the land," Lovitt said.
Native title is considered in law to have been "extinguished" by the granting of freehold title and some forms of leasehold.
Aborigines have lived in Australia
for at least 40,000 years
"The ordinary owner of a house will not be affected at all. Anyone who owns a very long-term lease is probably in the same situation," Lovitt said.
But unallocated state land and forests as well as parks and some reserves could be affected.
The ruling gives the Nyoongar people the rights to access the land and carry out traditional activities such as fishing, hunting and maintaining sacred sites.
In theory, if a park in the centre of town was found to be covered by native title, the Nyoongar people would have the right to live there, Lovitt said.
Aboriginal leader Noel Pearson welcomed the "absolutely extraordinary" decision by the court, saying it restored native rights to Aborigines who lived in the cities and southern regions of Australia.
Aborigines have lived in Australia for at least 40,000 years, but they are now a minority after more than two centuries of mainly European settlement, with a population expected to reach 470,000 this year out of a total of 20 million.
Many live in squalid outback camps, where unemployment, alcohol dependency and lawlessness are rife, while non-indigenous Australians are enjoying an unprecedented economic boom.
Senator Eggleston complained that the ruling might mean people could be charged admission fees to access Perth's parks and waterways.
"Every time you want to go and sail or fish you might have to have a permit to get on the river," he said.
But Glen Kelly, chief executive of the South-West Aboriginal Land and Sea Council, which represents the Nyoongars, dismissed the senator's claims as "scaremongering".
Aboriginal claims through the courts began around 1995 after the passing of the Native Title Act, the first legislation allowing rights to be contested.
"Western Australia is almost entirely under claim by hundreds of different groups"
native title specialist lawyer
A total of 89 claims have been heard in the whole of Australia and in 61 cases it was found that native title did exist, Lovitt said.
"This is only the tip of the iceberg, the ones that have actually been dealt with," she said, adding that there were "hundreds and hundreds of claims".
"Western Australia is almost entirely under claim by hundreds of different groups."
The vast state is rich in minerals including iron ore and gold, but Lovitt said native title did not cover rights to the minerals.
It could, however, give Aborigines some control over mining companies gaining access to the minerals and has dramatically increased their bargaining power in negotiations with the state government on community issues.