The 19-year-old man, who cannot be named for legal reasons, has been charged with explosives offences after allegedly planning multiple terror attacks in Melbourne including a school shooting, university bombing and train derailment.
The US Federal Bureau of Investigation tipped off Victoria Police which seized ammunition, handwritten notes and chemicals for explosive devices from his family home during a February raid.
The teen applied for bail on Thursday, when his lawyer claimed his young age, autism diagnosis and delays before the case goes to trial should allow his release.
However, prosecutors revealed the 19-year-old's cell had been raided by police that same day after prison officers discovered he had made "concerning" notes about attacks on police and transgender people, and "Nazi-type" documents while behind bars.
Magistrate Malcolm Thomas on Friday said the prosecution had proven the teen was an unacceptable risk of endangering members of the public.
He found there was a high probability the teen would reoffend based on allegedly "repeatedly" expressing ideation for an attack.
If the teen carried out his alleged plans then many people would be killed, injured and traumatised, the magistrate said.
He was concerned the teen had access to a "cache" of materials he could use in an attack, since one of his alleged chemical purchases remains unaccounted for.
The 19-year-old was diagnosed with level two autism and is being housed in an adult jail where he has been subject to "onerous" conditions including protection and isolation, the magistrate noted.
He described the prosecution's case as "strong" and said it was clear the teen's parents would do "whatever" they could to stop his actions.
The teen will next face the court in January.