The reform has proven to be controversial, but according to the Australian government, the changes are needed in order to tackle the threats of terrorism and crime.
Attorney-General Christian Porter said: "This ensures that our national security and law enforcement agencies have the modern tools they need, with appropriate authority and oversight, to access the encrypted conversations of those who seek to do us harm."
However, Dr Chris Culnane, from the University of Melbourne, has hit out at the move, saying it's not possible to create a "back door" decryption that would just target an individual.
He explained: "Any vulnerability would just weaken the existing encryption scheme, affecting security overall for innocent people."
The law change is a world first, although China, Russia and Turkey have already banned end-to-end encryption.
Despite the controversy surrounding the law change, only two MPs voted against the bill.
And prior to the vote, Australia had laws in place which require providers to hand over a suspect's communication to the authorities.