Anthony Albanese has lashed the Liberals and their "proxies" for running a smear campaign ahead of a by-election, while warning Labor MPs the contest will be tight.
Opposition Leader Peter Dutton used a meeting of coalition colleagues to temper expectations of an unlikely win.
Voters will head to the polls in the seat of Dunkley on Saturday, following the death of Labor MP Peta Murphy.
Right-wing lobby group Advance, which campaigned against the Indigenous voice to parliament, has rolled out billboards and social media ads taking aim at the prime minister over cost of living pressures.
A Labor party spokesman said while Mr Albanese didn't specifically name Advance in a caucus meeting on Tuesday, he referred to the "misinformation campaign on the ground, both with the Liberal Party and through their proxies".
The prime minister also spoke about the average swing against the Labor government in by-elections being more than seven per cent, when his party held the electorate by 6.3 per cent.
Mr Dutton was keen to unpack those numbers while addressing Liberal and National peers.
Since World War II, the average swing against a government in a federal by-election was 3.6 per cent.
The margin was slimmer for first-term governments and none had lost a by-election in that time.
Swings against Labor governments in Victoria were even more tight, with one coalition official saying: "It is a difficult place to do business."
Mr Albanese told the Labor caucus meeting "people are seeing and understanding more and more that Peter Dutton is someone without anything positive to say".
He described Labor's candidate Jodie Belyea as "fantastic".
The by-election is seen as 2024's first major litmus test for the government as it heads into an election year.
Polling of the Dunkley electorate found most people supported Labor's changes to stage three tax cuts, which increased benefits for lower paid workers while decreasing the windfall for higher income earners.
Mr Albanese said there were voters in Dunkley who didn't know about Labor's tax changes.
"We know they (coalition) don't like the tax cuts and want to reverse them," he said.
Speaking about the government's Help to Buy housing scheme, which would give aspiring home owners a leg-up into the housing market with a deposit as little as two per cent, Mr Albanese said the legislation would go through the house this week.
But the Greens and the coalition would team up to block the proposal in the upper house, he added.
Speaking earlier, the prime minister said Ms Belyea was recruited by Ms Murphy to run as a candidate.
"She's not a career politician ... she's someone who's deeply embedded in the community," he told ABC radio.
"So I think we've got the right candidate."
Nathan Conroy, the mayor of Frankston City Council, is contesting the seat for the Liberal Party.
Coalition officials described him as a strong, solid candidate who had run an impressive campaign.
