"It's just one of those things where they come from a slightly different perspective. They are part of Anzus, there's just different factors that might play into their thinking when it comes to nuclear disarmament."
Australia in October refused a New Zealand request to endorse a 125-nation joint statement at the UN highlighting the humanitarian consequences of using nuclear weapons.
Australia took exception to the statement's wording that it was in the interests of humanity that nuclear weapons were never used again "under any circumstances".
But Mr Key said it was "dangerous" to interpret that as a tacit statement from the Australian Government that the use of nuclear weapons could be justified in some circumstances.
"I don't think the Australians are arguing a nuclear war is in anyone's interests anywhere but they have a slightly different perspective on matters."
He could not see a scenario where the use of nuclear weapons to defend New Zealand could ever be justified.
The New Zealand-led campaign seeks to apply a similar international prohibition on the use of nuclear weapons as already exists for chemical and biological weapons.
But Australia's Foreign Affairs Minister Julie Bishop has been reported as saying that approach was counterproductive.
"The reality is that disarmament cannot be imposed this way," the Sydney Morning Herald reports her as saying. "Just pushing for a ban would divert attention from the sustained, practical steps needed for effective disarmament."
But the recently declassified documents reveal the Australian Government's main concern was that a nuclear weapons ban would "cut across" Australia's dependence on the US nuclear arsenal as a key part of its defence position.
An Australian Foreign Affairs and Trade Department document endorsed by Ms Bishop last year says a nuclear weapons ban "conflicts with Australia's long-standing position that, as long as a nuclear weapons threat exists, we rely on US nuclear forces to deter attack on Australia".