The prime minister was greeted by Indian counterpart Narendra Modi on the first day of the summit in New Delhi, before formal talks begin later on Saturday with leaders from the world's 20 largest economies.
The global talks come amid rising tensions in the Indo-Pacific and increasing Chinese aggression.
Mr Albanese said ahead of the summit he wanted to achieve a consensus on regional security.
"We want to see security, stability and peace in the region. The way to do that is to make sure that we engage in a constructive way," he said on Friday.
"I'm very pleased that the relationships that we've been able to build over a short period of time in the region has seen a significant shift."
The prime minister will give an address to the summit's first session, which will centre on climate change, renewable energy and decarbonisation.
Later in the day, Mr Albanese will hold bilateral talks with Japanese Prime Minister Fumio Kishida.
He will also attend talks as part of MIKTA, a gathering of summit leaders from Mexico, Indonesia, South Korea, Turkey and Australia.
Tensions are expected on the G20's statement regarding the Russian invasion of Ukraine.
Russian President Vladimir Putin has skipped the summit, with Foreign Minister Sergey Lavrov attending in his place.
Another major world leader, Chinese President Xi Jinping, has also opted to not attend, following tensions between China and India.
China's second-in-command, Premier Li Qiang, is representing the Asian nation at the summit.
Mr Albanese had already met with Mr Li in Jakarta on Thursday on the sidelines of the East Asia Summit.
Australia had been looking to de-escalate tensions with China, following the scrapping of trade tariffs on barley.
Mr Albanese said despite the government aiming for closer defence and security ties with nearby Asian nations who had issues with China, he would still seek to boost links with Australia's largest trading partner.
"We have positive relations, we are trying to develop our relationships throughout the entire region," he said.
"With regard to China, we'll co-operate where we can, we'll disagree where we must."
The prime minister also overnight held informal talks with European Commission President Ursula von der Leyen on a free-trade agreement between Australia and the EU, which had previously been stalled in negotiations.
The pair spoke about finalising the agreement as soon as possible.
New Delhi has come to a standstill due to the summit, with police closing off large sections of the city.
Nearby businesses and schools have been instructed to close as part of security measures
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