Mr Trump trashed the Ukrainian president as a "dictator without elections" and falsely claimed Kyiv had "started" the Russian war.
The US president incorrectly stated Mr Zelenskiy's approval rating was down to four per cent and implied Ukraine had stolen billions of dollars from his country.
In a strong rebuke, Opposition Leader Peter Dutton said Australia needed to back Ukraine.
"The thought that President Zelenskiy or the Ukrainian people started this battle, or somehow they were responsible for the war, is just wrong," he told 2GB radio.
"But Australia should stand strong and proud with the people of Ukraine. It's a democracy, and this is a fight for civilisation.
"Vladimir Putin is a murderous dictator and we shouldn't be giving him an inch."
Prime Minister Anthony Albanese reaffirmed the nation's support.
"Australia stands with Ukraine in their struggle, which is a struggle not just for their own national sovereignty, but it's the struggle to stand up for the international rule of law," he told reporters in Whyalla on Thursday.
Asked if Mr Zelenskiy was a dictator, Defence Minister Richard Marles replied "no".
"We will continue to support Ukraine so that they are able to resolve this conflict on their terms," he told Sky News.
Australia has committed more than $1.5 billion in aid to Ukraine since Russia's invasion on February 24, 2022.
Asked if the government was considering sending Australian peacekeepers to Ukraine, Mr Marles said it wasn't being discussed.
"There's a lot of water to go under the bridge before we get to that point," he said.
In a pointed threat to the Ukrainian president, Mr Trump warned he had "better move fast" to reach a peace deal with Russia "or he is not going to have a country left".
Professor Peter Dean, from the University of Sydney's United States Studies Centre, said Australia needed to call out the rhetoric when it was "blatantly false".
"He's (Trump) trying to get the US out of supporting Ukraine and an ongoing, never-ending war and he's trying to get the Europeans to pay for European security," he told AAP.
"We've also got to wait and see how it actually plays out on the ground."
Prof Dean said while Australia and the US were very closely aligned on a lot of things, Mr Trump was pursuing an "America First" foreign policy.
"What we're seeing here is a bit of a divergence between the Donald Trump view of the world and the bipartisan Australian consensus on international policy in the world," he said.
Australian Federation of Ukrainian Organisations co-chair Kateryna Argyrou slammed Mr Trump's comments as "shocking and appalling".
"President Trump appears to be captured by Russian propaganda, which is a very dangerous situation for Ukraine," she said.
"His comments are so utterly divorced from reality and are a huge concern.
"Ukraine is entitled to its sovereignty and independence and needs its rightful seat at the negotiating table."
In less than a week since Mr Trump had a conversation with Russian President Vladimir Putin, the US president's rhetoric has strained relations with European nations who disagree with his approach to end the conflict.
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