Canberra's tough measures against boatpeople - which involve detaining them in remote Pacific island camps while their refugee applications are processed - have attracted strong domestic and international criticism from rights groups.
Doctors and whistleblowers have also said the detention of asylum-seekers, particularly children, has left some struggling with mental health problems.
But a statement by immigration department head Michael Pezzullo - meant to counter a Sydney psychiatrist's criticism of the policies in the Australasian Psychiatry journal - drew fire when he used the term "allegedly" to describe experiences under Nazi rule in Germany.
Immigration Minister Peter Dutton yesterday slammed critics of his department chief, saying in a statement that "any suggestion that Pezzullo deliberately sought to deny or qualify the crimes of the Nazi era is patently ludicrous".
After the backlash on social media, the immigration department had issued a follow-up statement saying "any insinuation the department denies the atrocities committed in Nazi Germany are both ridiculous and baseless".
The row reflects the controversial nature of the government's policies, which Canberra has long defended as necessary to stop deaths at sea while securing the nation's borders.
Opposition Labor immigration spokesman Richard Marles had urged Dutton to formally withdraw the remarks and apologise, saying the second statement only compounded the problem.
"The reputation of the department is at stake, indeed the reputation of Australia is at stake," said Marles, whose party supports the offshore detention regime.
But Dutton accused Marles of seeking to "join the rabid voices of twitter and sections of the media". He called for an apology from his Labor counterpart for "impugning (the) integrity" of immigration officials.
