28-year-old Harry could either be formally embedded with an army unit or make an extended visit as an observer in Australian army, The Australian reported.
Australia is part of the Commonwealth, the club of ex-British Empire nations which maintain a friendly confederacy and retain the Queen as it's head of the state.
"Defence has begun planning for Prince Harry to spend six months on secondment with the Australian army as royal aides and security officials assess the risks of such a deployment," said the report.
Harry is a captain in the Household Cavalry Regiment and has returned home from a four-month long Afghan deployment in January.