The animals are being shipped to Singapore for the annual Korban, this year on October 26, where sheep are ritually killed with a portion given to the poor and needy.
Eighteen ''temporary facilities'' have been approved at mosques by the Australian government following the introduction of new strict animal welfare rules, known as ESCAS, for all live exports.
The rules, which require the exporter to guarantee animal welfare standards from farm to slaughter, were established after Australian cattle were slaughtered inhumanely in Indonesia last year.
Animals Australia's lead campaigner, Lyn White, said the public had lost confidence in live exports, citing the current saga involving the brutal culling of more than 7000 Australian sheep in Pakistan.
"Exporters managed to get Pakistan approved under ESCAS, despite risks that any reasonable person would have foreseen, and now inconceivably, mosques in Singapore have been approved as a location to ritually slaughter Australian sheep,'' Ms White said.
Animals Australia said in Singapore, and in Islamic countries, Muslims could fulfil their religious obligations by purchasing a voucher for an animal to be slaughtered in an abattoir in other countries, with the meat then distributed to the poor.
A Department of Agriculture spokesman said an export licence was granted in late September as it had met the new regulations.
''This included information required to set up 18 temporary facilities and the use of trained personnel. These conditions were approved on the basis that they comply with ESCAS regulations,'' he said.
Singapore's Prime Minister, Lee Hsien Loong, visited Canberra on Thursday and said Australia had gone ''the extra mile'' to ensure mosques that had been audited were cleared and qualified for the slaughter ritual.
Labor backbencher and critic of live exports, Kelvin Thomson, said Australians should encourage Muslims to fulfil their religious obligations by buying vouchers for sheep to be slaughtered in Australian abattoirs.
''Religious convictions that condone cruelty to animals should not be accommodated, they should be resisted,'' he said.