Stuart Bonds, who heads One Nation's NSW upper house ticket, addressed a crowd in Sydney's city centre on Sunday.
"Make no mistake, we are being demographically replaced inside our own nation," he said after talking about abortion rates in the developed world.
"If we don't support Australian mothers having Australian children, we are going to pay for other cultures' children to be brought up in our lands."
The roughly four-minute speech earned a sharp reproach from federal ministers.
Multicultural affairs MPs Julian Hill and Anne Aly told AAP the speech pushed white supremacist conspiracy theories and divided Australians.
"It's sadly not surprising a lead One Nation candidate is openly pushing racist, white supremacist conspiracy theories," Assistant Multicultural Affairs Minister Mr Hill said.
"The 'great replacement theory' is a widely discredited far-right, nationalist conspiracy with anti-Semitic roots.
"It's also mathematically nonsensical."
Multicultural Affairs Minister Dr Aly said questioning someone's right to belong was not "debate about immigration".
"It's divisive, dangerous and goes against everything we stand for as Australians," she said.
A One Nation spokeswoman said the immigration rate was unsustainable and needed to fall to ease pressure on essential services.
"It is unsurprising that two federal Labor ministers responsible for record high immigration are attempting to shut down legitimate political debate," she said.
Addressing attendees on Sunday, Mr Bonds said the "socialist plan" was to "destroy and bring down and tear down the fabric of your civilisation" before ruling over ruins.
He likened "stolen land" debates to "white South Africans" and Americans being told they do not belong in their respective countries.
"Yet, in the same vein, we're expected to believe an immigrant arriving yesterday is as Australian as you and me. I don't accept that," he said.
NSW Premier Chris Minns said on Monday the comments were "outrageous" and "racist".
"It makes me think - this bloke's heading the ticket for One Nation; (if they) win the election, what ministry is he going to have?" he said.
"Trade, education, treasury?
"What job will this bloke have in a coalition-One Nation government?'
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