Queensland Police say it is a crime for anyone to even watch a viral video of a man swinging a baby around a room.
Chris Illingworth, 60, a father of four from Maroochydore, was charged after he posted the video, which he stumbled across on YouTube, on an internet site.
The video, which shows the man swinging the baby by the arms, was broadcast on US television and has been viewed by hundreds of thousands of people online.
Illingworth's home was raided after he posted the clip on Liveleak. He was charged with using the internet to access and publish child-abuse material.
The charge has proven controversial because the baby - reportedly part of a Russian circus family - is shown laughing and smiling at the end of the clip.
Online rights activists and academics say the case has far-reaching implications for individuals sharing content online, as it is now clear they can be held just as liable as traditional publishers.
Online users' lobby group Electronic Frontiers Australia (EFA) has contacted Illingworth to provide him with help in fighting his case.
EFA vice-chairman Colin Jacobs said the law was a blunt instrument and no blunter than when applied to the internet.
"Any internet user could stumble upon these sorts of 'viral videos', which are a far cry from the organised child abusers against whom the laws are targeted," he said.
"I think that now Australians could justifiably feel very afraid that casual internet use might bring the police to their door."
Australian laws concerning the publication of such material are far stricter than in many other countries.
Here, news stations have shown only the beginning and end of the clip, while this website has been advised by lawyers not to show any of the clip at all.
In a statement, Queensland Police said the term "child-abuse material" even extended to clips in which a child "appears" to be a victim of cruelty.
The clip, criticised by child-welfare advocates because of how vigorously the man swings the baby, was created without any involvement of Illingworth, who has published hundreds of other clips on the Liveleak site.
Queensland Police from the anti-pedophile squad Task Force Argos raided Illingworth's home on November 30. He was subjected to a thorough forensic examination of his home and office computers and a gruelling interview over several hours, complete with fingerprinting and mug shots.
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