With lives left in limbo over the proposed changes, emotions were running high in the crowd against a bill that could more than double the amount of time settled migrants will have to wait to get citizenship.
National Union of Workers President Caterina Cinanni said her Italian-born grandmother would never have become a citizen of Australia under the proposed new rules.
"It's not fair for (Immigration Minister) Peter Dutton to make value judgments about the contribution of migrants to Australia on a test," she told the rally in Melbourne.
"It's unfair, it's immoral, and it's unjust."
Marketing manager Valentine Sesyolkin's wife is back in Kazakhstan expecting their first baby.
But now the 32-year-old migrant has no idea when they''ll be able to re-unite in Australia.
"It's quite hard for all of us because we don't know what's going to happen next," he said.
"We have been expecting that we are going to get permanent residency and then in one year we are going to apply for citizenship."
Under the bill, migrants could have to wait an extra four years for citizenship and pass new English language and Australian values tests.
Addressing the Sydney rally, refugee activist Ian Rintoul said the plan was deeply flawed.
"The reason that people are here today is because they want that little bit of paper. That little bit of paper makes a big difference to people," he said.
"You look at the questions that they ask in that test. They are insulting, they are offensive and they are Islamophobic."
The coalition says its bill is all about ensuring prospective citizens make a commitment to the country.
But it faces a rocky path in the Senate with Greens senator Janet Rice describing it as a law based on racism and fear.
"It's a law based on hatred and all of the Greens are standing with you to make sure that these laws don't get through the Senate," she said.
The government is also cracking down on temporary skilled, or 457, visas issued to overseas workers.
There will be tighter English requirements, stricter market testing to prove imported labour is required and mandatory criminal checks as part of the application process.
But business groups have welcomed a partial backdown on the changes which allows four-year temporary visas for high-skilled occupations instead of the proposed two.
Turkish migrant and business intelligence consultant, Tucge Guler, said making it harder to hire foreign workers could backfire on Australia.
"It's going to affect the economy of Australia if you can't get professionals here. If there is an open job and you can't fill it here then you have to get someone from overseas for the sake of your own economy," he said.
"In this globalised world, shutting down the doors to migrants is just ridiculous."
