Attorney-General Michelle Rowland has written to the privacy commissioner to examine privacy issues raised by the surge in demand for the wearable technology.
The glasses have in-built cameras that can take pictures and videos, with a Kmart version of the product recently selling out in stores.
Ms Rowland said the rapid take up of the technology could infringe on privacy needed to be examined by the Office of the Australian Information Commissioner.
"Unlike other forms of technology, smart glasses may be used more discreetly, making it harder to know when you are being recorded," she said.
"The OAIC regularly monitors the effects of new technologies on privacy – and the government has every faith that they will identify any new privacy risks and mitigation measures."
The attorney-general flagged the federal government was working on reforms for privacy laws in order to keep up with wearable technology risks.
While smart glasses have been around for several years, with versions linked to companies like Meta selling for several hundred dollars, the Kmart version has led to concerns over the technology and associated privacy issues being spread wider.
Fareed Kaviani, from Monash University's faculty of information technology, said there was a deep divide between people who used smart glasses and those who didn't.
"Owners tended to regard smart glasses as useful, fashionable and consistent with their identity. Non-owners were significantly more concerned about privacy, rudeness, inappropriate use and wearers taking advantage of others," he said.
"A central issue is consent,
as smart glasses make recording faster, more continuous and less visible, meaning existing social conventions around asking permission to photograph or record someone will be much harder to maintain."
Dr Kaviani said clear regulations were needed from the government on the use of smart glasses before the technology becomes more embedded in daily life.
Ms Rowland said there was significant privacy concern for women and children.
"Privacy is an essential part of all our lives; it allows us to be who we are with dignity and without fear," she said.
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