Home Affairs Minister Tony Burke revealed the government was keeping track of Hodan Abby's location after an order stopping her return to Australia on national security grounds was lifted.
Ms Abby, originally from western Sydney, allegedly tried to enforce traditional Islamic dress, including by threatening other women, and arranged marriages over the phone, the ABC reported on Monday.
She has also been accused of beating a Yazidi slave who was bought by her husband and raped while aged nine or 10.
Home Affairs Minister Tony Burke said Ms Abby would be weighing up whether to return to Australia, given she may face arrest on her arrival.
"Anybody who made a decision to go and join ISIS made an absolutely horrific decision, and we've got no interest in doing anything to help any of them back," he told ABC TV on Monday.
"If you also reach the threshold of an exclusion order ... they're only temporary, but you are in a different situation to the rest of the cohort.
"Our agencies are aware of her location ... she'd be weighing up the different things she's done and would be making a decision as to whether or not she in fact ever returns."
Some women linked to Islamic State who returned from the Middle East had been arrested at the airport, while others had been arrested later after police gathered more evidence, Mr Burke added.
Pressed on a separate report Australian men who travelled to the Middle East to fight for Islamic State may be freed from prison in Iraq, the minister said it would be "really tough" to meet the legal threshold to stop them returning home.
Thirteen Australians were currently jailed in Iraq but they were being interviewed by foreign officials and may be released, the Australian newspaper reported.
"If someone's a citizen, eventually they can come back," Mr Burke told Seven's Sunrise program.
"At the moment, every single one of these people is locked up and I've got no problem with that being the status quo," he said.
