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Australia has a prosperous Western-style capitalist economy, with a per capita GDP at the level of the four dominant West European economies; its developed market economy is dominated by its services sector (65% of GDP), yet it is the agricultural and mining sectors (7% of GDP combined) that account for the bulk (58%) of Australia's goods and services exports.

During the period of 1855-1890, the six Crown Colonies each successively became self-governing colonies, which managed most of their own affairs. British law was adopted in each colony at the time of the granting of responsible government, and was subsequently modified by the individual legislatures. The British government retained control of some matters, especially foreign affairs, defence, international shipping. Despite its heavily rural based economy Australia remained significantly urbanised, centred particularly around the cities of Melbourne and Sydney. In the 1880s 'Marvellous Melbourne' was the second largest city in the British Empire. Australia also gained a reputation as a 'working man's paradise' and as a laboratory for social reform, with the world's first secret ballot and first national Labor Party government.

Perth is the state capital city of Western Australia, the largest state in Australia. Perth is the world's most isolated city of more than a million people. In June 2003 the Perth Metropolitan Area had an estimated population of 1,433,217, making it the fourth largest city in Australia.

The British Crown Colony of New South Wales began by the establishment of a settlement (later to become Sydney) in Port Jackson by Captain Arthur Phillip on January 26, 1788. The date of arrival of the First Fleet was later to become the date of Australia's national day, Australia Day.

The name Australia derives from Latin australis meaning southern, and dates back to 2nd century legends of an "unknown southern land" (ie. terra australis incognita). The English explorer Matthew Flinders named the land Terra Australis which was later abbreviated to the current form. Previously, when the Dutch explored the area they named it Nova Hollandicus or New Holland.

Australian immigration has a checkered history. Immigration to the continent now called Australia began over 50,000 years ago, when the ancestors of Australian Aborigines arrived via Indonesia and New Guinea. Europeans began landing in the 1600's and 1700's, and the country was colonised by Britain in 1788.

Since 1996, the Coalition government, led by Prime Minister John Howard, has continued to implement microeconomic reform policies. Some have claimed that the deregulation of the labour market during this period has resulted in a needed flexibility in the labour force. Others have criticised these deregulations as having a negative impact on worker's wages, safety and health grounds. Legislation introduced during this period sought to reduce union involvement and power, and has preferred to emphasise enterprise bargaining (a tendency towards wage bargaining). Also during this period, the Coalition government deregulated numerous other industries, including the telecommunications sector, and privatised many of the pre-existing natural monopolies.

Australia's neighbouring countries include New Zealand to the southeast and Indonesia, East Timor, and Papua New Guinea to the north. The shortest border distance is between the mainlands of Papua New Guinea and Australia at about 150 km; however, the nearest inhabited island, Boigu Island, is about 5km from Papua New Guinea. This has led to a complicated border arrangement allowing access for 'traditional' uses of the waterway across the border by Papua New Guinean people and Torres Strait Islanders.

The national expansion of ABC youth radio station Triple J during the 1990s has greatly increased the visibility and availability of home-grown talent to listeners nationwide. Since the mid 1990s a string of successful alternative Australian acts have emerged - artists to achieve both underground (critical) and mainstream (commercial) success include silverchair, Grinspoon, Powderfinger, George and Jet.

Almost in the exact center of the continent, Alice Springs is some 700 kilometres from the nearest ocean and 1500 kilometres from the nearest major cities: Darwin and Adelaide. Alice Springs is now the midpoint of Adelaide-Darwin Railway.

Although most of the continent is desert or semi-arid, Australia nevertheless includes a diverse range of habitats, from alpine heaths to tropical rainforests. Because of the great age of the continent, its very variable weather patterns, and its long-term geographic isolation, much of Australia's biota is unique. Such species that are famously Australian include: koalas, kangaroos, emus, platypuses, wombats and echidnas.

Debate about the role of the ABC continues, as many assign it a marginal role, and claim that American-influenced commercial TV and radio stations are far more popular choices. These critics claim that Australian children grow up watching Sesame Street and The Simpsons, eating fries at McDonalds, wearing baseball caps, speaking American slang, and some have never heard of Blinky Bill or the Magic Pudding. Television ratings are cited as backing this view, but it is less clear that these ratings tell the whole view. Certainly there have been many local television shows that have been successful, such as Skippy (in the late 1960s), Number 96 and The Box in the 1970s, Prisoner in the 1980s, and Neighbours and Home and Away (in the 1980s and 1990s), which have sometimes been even more successful abroad.

Melbourne is a reasonably cheap and easy place to shop. There are innumerable clothing shops for every budget, though bargain hunters may wish to try the outlet stores in Bridge Road, Richmond.

Australia has had a significant school of painting since the early days of European settlement, and Australians with international reputations include Sidney Nolan, Russell Drysdale, and Arthur Boyd—not to mention the prized work of many Aboriginal artists. Writers who have achieved world recognition include Thomas Keneally, Les Murray, Colleen McCullough, Nevil Shute, Morris West, Jill Ker Conway, Booker Prize winner Peter Carey and Nobel Prize winner Patrick White. Noted expatriate writers include Germaine Greer and Clive James, who are sometimes better known in the UK than they are in Australia.

A reputation as a tolerant nation with strong humanitarian values is marred by past government policies excluding non-whites, and more recently a succession of scandals resulting in much criticism of Australia’s refugee programs.