That course of action would have created a legal precedent because it had never been used in Australia's history, she said.
"If we had tried to use it, we would have ended up in a world of legal uncertainty with the prospect of court action."
Ms Gillard dismissed reports she had refused to speak to Qantas CEO Alan Joyce on Saturday, before the grounding was announced.
Mr Joyce also rejected the reports, saying they contained "misinformation".
"I had no expectation of talking to the prime minister," he told ABC Radio, adding he had discussions with three senior ministers.
The prime minister also defended her decision not to contact Mr Joyce personally after he informed Transport Minister Anthony Albanese of the planned grounding on Saturday.
She said Mr Joyce had told the minister the decision was "not up for discussion".
"What I did was immediately act to take the application to Fair Work Australia ... that was the best thing I could do."
Mr Gillard denied suggestions the Qantas action had set a precedent for other big companies to use against trade unions.
"That is complete nonsense," she said, adding everyone knows their legal positions under the Fair Work Act.
Mr Joyce said the airline had warned the government 10 days ago the dispute was approaching a critical point.
"We'd been making it very clear to both sides of politics that this could not continue," he said.
"We told them that we could not survive indefinitely the way this was going."
The opposition said the government had sufficient notice on Saturday to intervene earlier.
"Instead it waited until the house was on fire before they actually decided to do something," transport spokesman Warren Truss told ABC Television.
Ms Gillard said it was now up to Qantas and trade unions to "sort themselves out" within the 21 days specified by Fair Work Australia.
Failure to do so could result in compulsory arbitration.
- AP
