Mr Dyball`s family said they believed the government should grant him an amnesty.
It is a crime under Australian law to aid militant groups in the Middle East.
The laws are primarily designed to protect Australia from militants returning home after fighting alongside IS.
Immigration Minister Peter Dutton said the government did not want to do anything to "provide an incentive or an excuse or an opportunity for people to go into a war zone", whatever their motives.
He told Sydney radio station 2SM: "His mum and dad obviously love him very much and it is an emotional issue, but we have to recognise that this is a theatre of war and people going off to role play in whatever side that they might see fit, is just not acceptable under Australian law."
`Just an amnesty`
On Facebook, where he uses the name Mitchell Scott, Mr Dyball had said last week he had been detained in Germany and could be "deported" to Australia to face charges.
He arrived home on Sunday evening and was greeted at Melbourne airport by his family and supporters. It was unclear whether or not he had been deported.
He was questioned but released without charge pending further investigations and has now travelled back to his home in Brisbane.
Mr Dyball`s father, Scott, said he and fellow Australian, Reece Harding - who was killed fighting with the YPG in June - were "heroes".
"How can you have evil and good and say it`s the same thing? It`s not. It`s not the same thing," he told reporters at Melbourne airport on Sunday evening.
"All we are asking is just an amnesty."
His mother told ABC News he had been helping to disable landmines in Syria saying: "I don`t see what`s so criminal about dismantling landmines so people can return home."
Australia is on high alert for attacks by radicalised Muslims, including those returning home from fighting in the Middle East.
Federal Police assured the public that "any Australian who is identified as a threat to security" would be investigated.
The statement added that Australians "have been consistently warned that by becoming involved in overseas conflict they are putting their own lives in mortal danger".
Mr Dyball`s lawyer, Jessie Smith, told the BBC he could claim the defence that he was engaged in the armed service of a foreign government, due to Kurdish autonomy in certain areas of northern Syria.
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