9News understands the Australians are on the American submarine as part of the AUKUS training rotation.

The submarine hit the frigate IRIS Dena with a Mark-48 torpedo, killing more than 80 Iranian sailors in a strike described as "quiet death" by US Secretary of War Pete Hegseth.

The IRIS Dena was heading back to Iran after taking part in joint military exercises off India's eastern coast.

The Defence Department refused to identify the rank or role of the Australians on the US submarine.

"There are long-standing arrangements relating to third country deployments to ensure Australian interests are managed appropriately," a Defence spokesperson said.

"It is not appropriate to go into these details.

"For operational security reasons, the Australian Defence Force does not disclose specific details regarding third country deployments, including the number of personnel or their location."

"As the United States and Israel have said, the military strikes were initiated and conducted by the United States and Israel - not Australia."

Sri Lanka's navy said 87 bodies had been recovered and that 32 Iranian sailors were rescued. The ship had about 180 on board.

IRIS Dena was about 40 nautical miles (75 kilometres) off Galle when it sent a distress call between 6am and 7am AEDT (00:30 to 01:30 GMT).

Up to 100 Australians are expected to be embedded on US submarines as part of the AUKUS rotation program this year.

Foreign Minister Penny Wong told the Senate: "US submarine operations are a matter for the United States."

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