Her scooter is eventually pulled to the side of the road and despite being surrounded by five officials, the woman does not back down.
She continues to argue with an officer before the video cuts off.
Bali Police told local English news site Coconuts Bali that the incident unfolded on Thursday in North Kuta, Badung.
Police confirmed that the woman was Australian and was fined.
Under Indonesian law, driving a motorcycle without a helmet carries a fine of 250,000 Indonesian Rupiah, which is about $26.
Hundreds of local Twitter users slammed the woman’s behaviour, labelling her an entitled “bule” – an Indonesian word used for white foreigners. Many claimed she should be deported.
“It doesn’t matter if you’ve been here 5 mins, let alone 23 years – if you’re getting on a motorbike, wear a helmet,” one man wrote.
“If you go to another country have decency to respect them,” said someone else.
“yt (white) people always think they’re above the law when it comes to Asian countries. It’s disgusting really,” added a third.
“The reason why I hate bules in Indonesia,” claimed a fourth.
The viral video comes as Bali prepares to crack down on misbehaving tourists.
Bali Tourism Board chairman Ida Bagus Agung Partha Adnyana is on the brink of launching a public campaign that will see billboards installed where customs are flouted the most – such as the more popular locations of Kuta, Seminyak, Legian, Canggu, Ubud, Sanur, Nusa Dua, and Uluwatu.
Mr Adnyana said they’re currently in the “socialisation” phase of a new campaign which will aim to build awareness among visitors and educate tourists on how to behave in cultural settings.
“The point is that tourists respect Balinese cultural customs by dressing well and neatly, following in an orderly manner, carrying out traffic activities and not doing things that are outside the provisions,” he told The Bali Sun.
The proposal has been tabled and officials are now awaiting public feedback.
It will see at least 10 large billboards installed with instructions and advice in foreign languages, including English.
Luhut Pandjaitan, a senior minister who is considered extremely influential in Indonesia, said last week he spoke with Bali Governor Wayan Koster about misbehaving tourists.
“We do not need naughty tourists in Bali,” he said, according to Coconuts Bali, adding the government reserves the right to send them home.