Prime Minister Julia Gillard said her thoughts were with the soldier's family and comrades "at this time of great stress and distress for them."
But she said Australian Special Forces, which include soldiers from the SAS, and Commandos and the Special Operations Engineer Regiment, would remain after other troops were pulled out.
She said it was expected that there would still be "active fighting" against Taleban insurgents beyond 2014, when security will be handed over to the Afghan National Army.
"There will be a continuing role for Special Forces until transition is complete," she said.
Gillard, who visited troops in Afghanistan on her way to talks in India last week, said Australian soldiers remained in good spirits.
"They are very determined to see the mission that we have set ourselves through, a mission with a defined strategy and a defined end point," she said.
Previous losses in 2012
August 30: Two soldiers from the 2nd Commando Regiment aboard a helicopter are killed as it attempts to land in Helmand province.
August 29: Three Australian soldiers are killed when a person in an Afghan National Army uniform opens fire inside a patrol base 20km north of Tarin Kowt in Uruzgan province.
July 1: An SAS soldier is shot in the chest during a fight with insurgents in the Chora Valley in Uruzgan.
- AAP
