YDNEY - A former Australian terror suspect who was jailed for more than three years in the US military's Guantanamo Bay prison camp has announced plans to stand in an upcoming state election.

Former Guantanamo Bay detainee Mamdouh Habib, who was jailed for more than three years in the US military's prison camp, has announced plans to stand in an upcoming state election.  [AFP]

Mamdouh Habib said he was putting himself forward as a candidate in next month's New South Wales state election to campaign against Australia's involvement in the Iraq war and the country's tough counter-terrorism laws.

Habib said he was standing for "the right of freedom of expression and in opposition to the anti-terrorist laws, state and federal, the right to fight racism, the end of scapegoating of Aborigines, Muslims and migrants."

In a statement, he also listed "the right to oppose Australia's involvement in Iraq" as one he would fight for.

Habib will stand in the seat of Auburn, in Sydney's western suburbs, which is home to Australia's largest mosque and a significant portion of the country's 300,000 Muslims.

The Australian Labor Party (ALP) holds power in NSW and has a 26.5 percent majority in the Auburn seat.

"Mr. Habib is preaching the politics of division, something the ALP will always fight," a Labor Party spokesman said.

Habib was detained in Pakistan in late 2001 on suspicion of terrorist links and eventually jailed at Guantanamo Bay after first being handed over to authorities in Egypt, where he says he was tortured.

He was released without charge by US authorities in January 2005 and has insisted since his return that he was not a terrorist and had no ties to Osama bin Laden's al-Qaeda network.

Since returning to Sydney, he has complained of harassment from police and intelligence officials.