The platform formerly known as Twitter has been issued with a legal infringement notice and has 28 days to respond or pay the $610,500 penalty.
Google has also been handed a formal warning for exhibiting a lack of transparency, with both tech giants accused of failing to adequately respond to a number of questions.
Issued with new transparency powers, eSafety issued please explain notices to Twitter (subsequently rebranded as "X"), Google, TikTok, Twitch and Discord in February.
However the regulator's latest report summarising their answers, highlights serious shortfalls in how some companies detect, remove and prevent child sexual abuse material and grooming.
It also examines inconsistencies in how companies deal with material across their different services and variations in the time it takes them to respond to public reports.
Commissioner Julie Inman Grant said the non-compliance was disappointing especially as the questions related to the protection of children and the most egregious forms of online harm.
"Twitter/X has stated publicly that tackling child sexual exploitation is the number 1 priority for the company, but it can't just be empty talk, we need to see words backed up with tangible action," she said.
"If Twitter/X and Google can't come up with answers to key questions about how they are tackling child sexual exploitation they either don't want to answer for how it might be perceived publicly or they need better systems to scrutinise their own operations."
Google is alleged to have provided generic and aggregated responses to specific requests for information, while X failed to provide any response to some questions, leaving some sections entirely blank.
In other instances, it provided a response that was otherwise incomplete and/or inaccurate.
Ms Inman Grant said the proliferation of online child sexual exploitation was growing and tech companies had a moral responsibility to protect children from sexual exploitation and abuse being stored, shared and perpetrated.
"We really can't hope to have any accountability from the online industry in tackling this issue without meaningful transparency which is what these notices are designed to surface," she said.
