On Thursday Foreign Minister Julie Bishop reiterated Australia's opposition to the death penalty "in all circumstances for all people", noting "I understand Ms Exposto has the right to appeal the decision."

The Department of Foreign Affairs and Trade will continue to provide full consular assistance, she said.

Ms Exposto's lawyer Shafee Abdullah told her client it was a temporary setback, vowing Exposto would win the appeal, according to the Daily Telegraph. "You will win and you will walk away," the lawyer was reported as saying.

The latest decision comes five months after Exposto was acquitted of drug trafficking.

Defence lawyers had said Exposto, a mother of four from Cabramatta in Sydney, was the victim of a sophisticated romance scam that has entrapped thousands of people.

She fell for the scam after starting an online relationship with a supposed American soldier who had served in Afghanistan, lawyers claimed.

The arrest of Exposto, a former social worker in East Timor, shocked her family and friends in Sydney, who said she was a devoted and loving mother and grandmother.

Exposto previously told lawyers she believed the suitcase she was carrying during her arrest contained only clothes that a stranger in Shanghai had asked her to take to Melbourne.

It is believed Exposto had fallen in love with the man who had groomed her over two years before she flew to the Chinese city and was handed the suitcase, her lawyers say.

The lawyers claimed she did not know the drugs were there, saying she had "never seen drugs in her life," and volunteered her bag to be scanned by an airport X-ray machine.

Prior to her arrest Exposto and her husband had separated and were intending to divorce.

Defence lawyers previously argued that Exposto's willingness to put her bag through a security scanner shows she did not know the drugs were there.

She was booked on a connecting flight to Melbourne and could have stayed in the airport's transit areas without having to pass through the security checkpoint.

Malaysia has a mandatory death penalty for anyone found guilty of carrying more than 50 grams of an illegal drug.

The three judges unanimously found Exposto guilty but said she had a right of appeal and wished her luck, according to AAP citing media reports.

"We find the merits of the appeal, we allow the appeal and set aside the judgment of the judge and find her guilty as convicted. The only sentence under law is death by hanging," the judges found.

Exposto’s elation at being acquitted on December 27 last year was shortlived with the prosecution announcing an appeal shortly after.

Three Australians have been hanged for drugs offences in Malaysia since 1986.

Five people have been executed in Malaysia in recent years.

with agencies