At least 19 people have been killed in anti-corruption protests in the capital Kathmandu. Demonstrators have stormed the nation's parliament and set the building on fire.
Nepal's prime minister has also resigned, with no clarity on who will replace him.
A key Nepalese diaspora group in Australia said the crisis stemmed from "years of poor governance, corruption and a lack of accountability".
"Watching from afar, there is a sense of grief and frustration, particularly as young lives have been lost in the struggle for justice and reform," Australia-Nepal Friendship Society president Niraj Gauli told AAP.
The organisation will hold a vigil in Canberra on Thursday evening, calling for "peace, accountability and genuine reforms" in Nepal.
Foreign Minister Penny Wong said Australia was deeply concerned about the turmoil.
"We urge all parties to exercise restraint and to resolve the situation peacefully," she said in a social media post.
Kathmandu's international airport has been closed and all flights cancelled. There's no indication when it will reopen.
The Department of Foreign Affairs is urging Australians to "reconsider your need to travel" to the popular trekking and climbing destination, warning the situation may continue to deteriorate without warning.
Himalayan Guiding Australia founder Seane Pieper said the situation was unpredictable, but tourists had generally been left alone during previous uprisings.
"Historically, it's not as catastrophic as people might think," he told AAP.
Mr Pieper is planning a trip to the Langtang Valley, about 180 kilometres north of Kathmandu, in two weeks.
He said he was fielding anxious calls from clients, but was hopeful the situation would calm down.
"They're not worried about it up in the hills," he said.
"In Kathmandu they are because obviously 19 young people got killed, but the history of Nepal is these things blow up and then they actually calm down a bit and people get on with their lives."
Mr Pieper says travellers concerned about the situation should contact their travel provider.
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