Conversation groups warn listing koalas as endangered across Queensland, NSW and the ACT won't be enough to bring dwindling populations back from the brink.
Land clearing, climate change and disease have sparked concerns the marsupial could be extinct before the middle of the century.
Federal Environment Minister Sussan Ley has downgraded the conservation status of koalas across the east coast in line with a recommendation from the government's Threatened Species Scientific Committee.
"There have been many pressures on the koala. The Black Summer fires, of course, was a tipping point. But we know the koala is vulnerable to climate change and to disease," Ms Ley told reporters at the Blue Mountains on Friday.
The Australian Koala Foundation has called for a koala protection act and legislative action to curb land clearing.
It warns koalas are also in danger across Victoria and South Australia.
"This change in status unfortunately is nothing but a token gesture that results in no legislative change to save the koala," foundation chair Deborah Tabart said.
"Behind all the photo opportunities and political rhetoric they (the federal government) continue to approve the destruction of koala habitat."
Ms Ley pointed to chlamydia vaccines for koalas, the use of drones to surveil populations and habitat restoration as ways governments were working to protect the marsupial.
"There are international issues when it comes to climate change. Of course, Australia is playing its part. But there's much that we can do in our communities," she said.
Since 2001, koala populations in NSW have declined by between 33 and 61 per cent. A state parliamentary inquiry in 2020 warned the marsupial would likely become extinct before the middle of the century without urgent intervention.
At least 6400 koalas were wiped out by the 2019-20 summer bushfires alone.
Similarly, Queensland koala populations have at least halved since 2001 because of drought, fires and deforestation.
The federal government argues the endangered listing will highlight and help address threats to koala populations.
It wants Queensland, NSW and Victoria to sign up to a national recovery plan worth $50 million over four years.
WWF-Australia conservation scientist Stuart Blanch urged federal and state governments to commit to doubling koala numbers on the east coast by 2050.
"Koalas have gone from no-listing to vulnerable to endangered within a decade. That is a shockingly fast decline," he said.
"Today's decision is welcome, but it won't stop koalas from sliding towards extinction unless it's accompanied by stronger laws and landholder incentives to protect their forest homes."
An Australian Conservation Foundation analysis found the amount of koala habitat approved for clearing had increased every year since 2012, when east coast koalas were first listed as vulnerable.
It said the federal government rubber-stamped the loss of more than 25,000 hectares of habitat, equivalent to 526,000 average-sized blocks of residential land or about 10,400 Sydney Cricket Grounds.
Approvals were granted for 63 mostly mining projects in Queensland, NSW and the ACT.
The federal government has listed the marsupial as endangered as it continues to fight attempts to downgrade the Great Barrier Reef's UNESCO listing to "in danger".
It argues the two can't be compared and the reef shouldn't be singled out because climate change is threatening all World Heritage sites.
