"If we're re-elected it won't apply to anybody because I will reverse it", he said.
"I'm going to be engaged in very clear and direct messaging to anyone who thinks they should get on a boat", Mr Morrison said.
Its defeat, the first such loss of a lower house vote on a bill since 1941, comes as the government has struggled for months to close a six-point gap in Australia's most widely watched opinion poll.
The issue threatens to undermine Labor's border security credentials ahead of the next election.
The move was initially seen as a sign his support for the bill was wavering, but he ultimately made a decision to continue his support.
The bill must be approved by the upper house to become law, but is likely to pass, as the Senate supported an earlier version past year.
"Votes will come and they will go, they do not trouble me", Prime Minister Scott Morrison told a news conference in the capital, Canberra, after the vote.
In a surprise legal twist just hours before the vote, the government cited legal advice from the Solicitor-General to argue the bill would incur additional expenses by creating a panel of medical experts to rule on refugee transfers.
"It's humiliating for the government", said Rod Tiffen, a political analyst at the University of Sydney.
Professor Twomey said that if the government claimed the bill was a money bill, the government would be exposed to claims it should lose power if it lost a vote on the bill.
But the 75-74 vote - which came on the first sitting day of Parliament this year - in favour of the refugee Bill opposed by the government is a blow to the already embattled Prime Minister and raised questions about whether he can remain in office.
The opposition Labour party responded furiously to what it called Morrison's "scare tactics" and said he was manufacturing a fear of migrants to win votes.
Speaking in front of Parliament House this morning, Morrison reiterated his position the vote will encourage people smugglers to continue their operations in Australian waters - and that reopening the shuttered centre was part of a contingency plan to dissuade those potential arrivals.
Mr Shorten proposed a deadline of three days for each decision to transfer a refugee to Australia for medical treatment, scaling back Labor's initial deadline of one week.
The security grounds have also been clarified.
The later version of the Labor proposal applies the same section of the Migration Act but adds the condition that the minister must "reasonably believe the person would expose the Australian community to a serious risk of criminal conduct".