Opposition Leader Tony Abbott has attempted to have parliament censure the prime minister over her "lie" on the carbon tax.
Mr Abbott said the house should censure Julia Gillard for breaching faith with the Australian people by introducing the carbon tax, due to take effect on Sunday.
In a rare act, Ms Gillard has stayed in the chamber to hear what the opposition leader has to say.
"What a red-letter day," Mr Abbott told parliament on Thursday.
"At last, she is prepared to respond and to explain why it is that she so thoroughly misled and lied to the Australian people."
Mr Abbott withdrew the "lie" remark just before being ordered to do so by deputy speaker Anna Burke.
Manager of opposition business Christopher Pyne said Ms Gillard was "without integrity, without solutions and without a future''.
"The prime minister reminds me of a rabbit at a greyhound race meet,'' he said.
"She's out the front, she's been pursued by the greyhounds behind her,'' referring to former Labor leader Kevin Rudd and frontbenchers Simon Crean, Stephen Smith and Bill Shorten.
Ms Gillard said Mr Abbott's censure motion showed he had no ideas of his own.
"The leader of the opposition, day after day, believes that insults are substitutes for ideas,'' she told parliament.
"Well, you cannot say you want to be prime minister of this country and not offer one idea about the nation's future.''
The motion was lost 67-74.