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The problem relates to an auxiliary water pump that helps cool the turbocharger.
BMW says on its US website that an electronic circuit board could fail and, "in an extreme case", lead to the "smoldering of the water pump".
There have been two cases of fires in the engine compartment among 102 cases of pump failures worldwide, but the German car manufacturer said it was not aware of any accidents or injuries related to the defect.
BMW Australia spokesman Piers Scott confirmed there have been no reports of failures here.
"We got the list overnight," he says. "Nine hundred cars in Australia are potentially affected. The tech team are working through it now. It's a technical campaign - a simple replacement of the water pump, to be carried out through normal servicing, at no cost to customers."
The affected cars are 2008-11 model 5 Series, 7 Series, X5 and X6 equipped with turbocharged 8- or 12-cylinder engines.
BMW described the recall as voluntary and has told the American Highway Traffic Safety Administration that in most cases, the driver would get a warning on the instrument panel of the problem.
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