Mark Wood and Tom Curran are likely to be missing for England due to injury.
Both sides sit on four points in their Super 12s group after starting their campaigns with two successive wins, and whoever prevails in Dubai on Saturday night will take a massive stride towards sealing a semi-final place.
“It’s probably going to be one of our most difficult games,” Morgan said. “Australia are a very strong side – they’ve won two from two, much like us – and have started well.
“Coming into the tournament, they would probably be considered joint second favourites, along with us. They’re a side that we know pretty well – we’ve played against them a lot over a number of years.”
Mark Wood required an injection to his left ankle last week and has been unavailable for the emphatic victories over the West Indies and Bangladesh, and it seems unlikely the express pace bowler will be risked on Saturday.
Seamer Tom Curran has also been absent from England’s opening two matches because of a knee injury and while he will probably miss out, trop, Morgan was upbeat about the pair’s recoveries.
“They’re progressing really well,” Morgan said. “Where we were before the first game, they’ve come on a long way.
“We’re going to make a call on that tomorrow to see how training is and then tomorrow we’ll make a call on them.”
The International Cricket Council’s strict kit regulations during global tournaments have denied England the chance to wear their ‘Moment of Unity’ t-shirts carrying messages of all forms of anti-discrimination.
England launched the initiative in their home games over the summer, but during this tournament they have joined the West Indies and Bangladesh in taking the knee – opting for a reciprocal approach to the anti-racism gesture.
And Morgan revealed taking a knee for the remainder of the tournament is something that will be discussed in Friday afternoon’s training session.
Morgan added: “From our side of things not being allowed to have our ‘Moment of Unity’ before the game is something we’ve talked about before the two games we’ve played.
“Later this afternoon we’re going to talk about it again, because if we’re not allowed to take our stance against all discriminations, we need to try to find something else that makes a difference.
“We can do (the ‘Moment of Unity’) in bilateral series both home and away. We’ll speak as a team and try and come up with something that we can do.”