Queensland Premier Campbell Newman won't be regulating a Google-backed driver hire company operating in Brisbane, although he has some concerns about the service.
The taxi industry has lobbied the government to crack down on Uber, which allows non-taxi drivers to offer a ride-sharing service.
Uber's service is limited to licensed drivers aged at least 24, whose vehicle has at least four doors and was manufactured after 2005.
Drivers must have comprehensive insurance and no criminal record.
NSW effectively banned Uber this month, when it announced that all drivers must be accredited, but the Queensland premier won't be following suit.
"We are a deregulation-minded government," he told ABC radio.
"We don't believe in more red tape and regulation unless it's absolutely necessary."
Newman has some worries the service may not be as safe as traditional taxis, and wouldn't want his daughters to use it.
"I do have some concerns over the whole thing," the premier said.
"I've got daughters, 19 and 21 — I would prefer them catching a cab because I know about all the safeguards, cameras, trained drivers, GPS locations of cabs real-time.
"Yes [Uber] has safeguards in there as well, but I'd prefer to use a ridgy didge cab."
Uber has upset regulators and established taxi and hire-car operators worldwide, who claim the services are unsafe.