Under the changes, which come into effect from Monday, vapes will only be able to be sold at pharmacies.
Pharmacists will be able to sell vapes with limited nicotine content over the counter, once they have a discussion with a person about health harms and confirm they're over 18.
However, independent MPs say the laws are a watered-down version of the original legislation, which would have required people to get a prescription to access vapes.
The laws were changed following negotiations in the Senate.
Health Minister Mark Butler said the changes would protect young people from being hooked on nicotine through vaping,
"We are not going to stand by and let our new generation be recruited to nicotine addiction, not after all of the death and the dislocation and the grief that we have seen for decades and decades because of tobacco," he told parliament on Thursday.
"This product was sold to us as a therapeutic good.Â
"It was never presented as a recreational product, particularly not one that would be so cynically, so transparently, marketed to our children."
Vapes will only be sold in plain packaging and without flavouring under the reforms, to protect children.
People under 18 will need a prescription to buy vapes.
While the vaping laws are federal legislation, they will be enforced by state and territory police.
Independent MP Zali Steggall told the lower house the deal made in the Senate had diluted the impact of the reforms.
"We now have a situation where pharmacies are going to be asked to sell over the counter a product that we know, from a health perspective, is dangerous, has a negative impact on people's health," she said.
"I cannot see how this is a positive development for the government to have caved in for these amendments."
Mr Butler said the laws ensure therapeutic access to vapes remains while banning the sale of recreational vapes from general retail stores.
"Almost every month, we are gathering new evidence about the harms that vaping is causing to young lungs, the harms, particularly that nicotine addiction is causing to the mental health of young Australians," he said.
"Most insidiously, we know this is a gateway to cigarettes, and that was the intention of big tobacco."
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