The World Health Organisation says Papua New Guinea is facing an untreatable form of tuberculosis.
The UN agency says infections of multi-drug resistant tuberculosis (MDR TB) in south-west PNG are at crisis levels.
The ABC reports medical records show 94 people have contracted MDR TB in Western Province since 2005.
But the records are incomplete and WHO suspects those cases are just the tip of a much bigger iceberg.
PNG health minister Jamie Maxtone-Raham says TB is now a greater health risk than HIV/AIDS.
AusAID has provided $A1 million to improve health facilities in Western Province.
The money is being used to train and recruit medical staff, purchase a boat for outreach programmes and to construct a TB ward at a hospital on Daru Island.
Half the identified cases of MDR TB were treated at tuberculosis clinics in the Torres Strait, just across the maritime border with Australia.
But the ABC reports Queensland's Department of Health said earlier this year that it would close the clinics because of a funding dispute with the federal Health Department.