The Dalai Lama said he wasn't disappointed. He seemed to know little about Gillard -- including her gender.
"If your prime minister has some kind of spiritual interest, then of course, my meeting would be useful, otherwise I have nothing to ask him," the Dalai Lama said during a news conference.
He twice referred to Gillard as a man before he was corrected.
Meetings with the Dalai Lama are a delicate issue for heads of state because China regards him as a dangerous separatist who wants Tibet to split from the country -- a charge he denies. In Australia, which has extensive trade ties with China, a low-key 2008 meeting between the Dalai Lama and the acting prime minister brought a rebuke from Beijing.
Some lawmakers accused Gillard of being out of step with Australia's most important defense ally, the United States, where the Dalai Lama has met President Barack Obama.
Some observers suspect Gillard is demonstrating her independence of the Greens party, a vocal critic of China's control of Tibet and a crucial supporter of the ruling Labor Party. Greens leader Sen. Bob Brown met the Dalai Lama Tuesday and had been lobbying Gillard to do the same.
Brown criticized Gillard for failing to meet the Dalai Lama while her office door was open to mining executives.
"There is more to this place than simply people with big money," Brown told reporters, referring to Parliament House.
Gillard did not provide reasons for her snub, despite acknowledging last month that Australians expected their leaders to receive the revered Nobel Peace Prize winner.
"The Dalai Lama is a frequent visitor to Australia, I think he's been here four times in the last five years," she told reporters. "On some occasions he's met with the prime minister, on others he hasn't."
"I've determined on this occasion that I won't be meeting with the Dalai Lama," she said.
The 75-year-old Tibetan Buddhist leader held meetings with conservative opposition party leaders on Tuesday and will hold a private meeting with education minister and former rock star Peter Garrett as the government's representative on Wednesday. Garrett's meeting scheduled for Tuesday had been postponed, his office said.
Garrett, a former environmental activist and lead singer of Midnight Oil, also represented the government when the Dalai Lama last visited in 2009.
Michael Danby, convener of the Friends of Tibet group of lawmakers, said he had expected at least Foreign Minister Kevin Rudd would have met the Dalai Lama to gain insights into the democracy movement in China.
Conservative Prime Minister John Howard was the last Australian leader to meet Tibetan Buddhism's highest spiritual authority, in 2007 during a 20-minute chat in Howard's Sydney office.
The current Australian visit is the Dalai Lama's first since Gillard became prime minister a year ago and the third since he met Howard. The Dalai Lama's 2008 meeting was with Sen. Chris Evans, then the government's third-highest-ranking lawmaker; he was acting prime minister because then-Prime Minister Rudd and Gillard, then his deputy, were both overseas.
The Dalai Lama recently turned over his political authority over Tibetans, but remains their spiritual leader.
In a press conference at Parliament House, he warned Australia of the ecological dangers of its current mining boom and its burgeoning trade in raw materials exported to China.
He rejected a reporter's suggestion that Australian mining executives should look for other customers because of China's human rights record. The Dalai Lama said China should not be isolated or contained.